PYPL

Nelson’s Earnings Roundup: GOOG(L), PYPL, INTC

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Image Source: Aaron Fulkerson Let’s get President of Valuentum Brian Nelson’s quick thoughts on the earnings reports of Alphabet, Paypal, and Intel, all very important holdings in the newsletter portfolios. By Brian Nelson, CFA Alphabet The Mountain View, California-based Internet search giant continues to do a lot of things right. CFO Ruth Porat called the top-line growth in the fourth-quarter results of the company formerly called Google “exceptional.” Alphabet (GOOG, GOOGL) is the lifeblood of the Internet, and consumers every day consult Google with their innermost questions and sometimes deepest thoughts and concerns (looking for answers). It will remain a core aspect of our lives, as core as the most innate possessions of those that use it. During the quarter, … Read more

PayPal: The Way of the Future

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Image Source: PayPal “As a customer champion and a leader in financial technology, our goal is to provide simple, affordable, secure, and reliable financial services and digital payments that enable the hopes, dreams, and ambitions of millions of people and businesses around the world, including those who have been underserved by the traditional financial system. This focus and clarity enabled us to achieve strong growth across every key aspect of our business in 2015. For the year, revenue increased 19 percent* to $9.24 billion, and our total payment volume reached $282 billion, an increase of 27 percent. We also generated $1.8 billion in free cash flow.” – PayPal’s 2015 Annual Report By Brian Nelson, CFA Best Ideas Newsletter portfolio holding … Read more

After-Hours: MSFT +5.9%, PYPL +4.6%

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A holding in the Dividend Growth Newsletter portfolio and a holding in the Best Ideas Newsletter portfolio are indicated up after hours October 20. You may remember us taking some profits on Microsoft (MSFT) following its deal to acquire LinkedIn (LNKD), but did you know the company has been the prime example of our cash-flow-based dividend methodology for years? Microsoft was added to the Dividend Growth Newsletter portfolio at inception at a tender price of ~$26 per share. Our roughly 2.5% current weighting (yes, it is still one of our favorite dividend growth ideas!) is indicated up in after-hours trading, now to all-time highs near $61 per share, even past those of the dot-com bubble days! We’re not going to … Read more

Reiterating Our $50 Fair Value Estimate on PayPal

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Image Source: PayPal 2Q presentation, page 10 By Brian Nelson, CFA A quarterly “beat and raise” and a new agreement with Visa (V) weren’t good enough to drive shares of PayPal (PYPL) higher July 22, but we’re not worried. Revenue growth of 19% on a foreign-currency neutral basis and non-GAAP earnings per share growth of 11% wasn’t bad at all. Operating cash flow and free cash flow generation of $696 million (up ~12% year-over-year) and $495 million (up 27% year-over-year) in the quarter wasn’t too shabby either. Through the first six months of 2016, the company has generated $1.1 billion in free cash flow, better than the $740 million mark generated during the same period a year-ago. Active customer accounts … Read more

PayPal’s Growth Engines Still Firing

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Image: PayPal continues to add millions of active customer accounts each quarter. Source: PayPal’s Q1 2016 Investor Update. By Brian Nelson, CFA Revenue up 23%, excluding foreign exchange rate fluctuations. GAAP operating margin up 90 basis points. GAAP earnings per share up 43%, to $0.30. Operating cash flow of $738 million. Free cash flow of $605 million, up 70% year-over-year. 1.4 billion transactions processed. Ended the quarter with 184 million active customer accounts, up 4.5 million. These were just a few headlines in PayPal’s (PYPL) first-quarter report, released April 27. PayPal is mainstream – it’s no longer just a way to send money between friends, if it truly ever was just this. The secular trend toward a cashless society is … Read more

You Can Change Your Mind!

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By Brian Nelson, CFA It looks like the energy master limited partnership (AMLP, AMZ) space has been catching a bid the past few days. It’s so important, however, to keep things in perspective, and the best way to do so is to look at an intermediate-term chart of the group, which remains under considerable stress, “Bye Bye Energy MLPs, Part II (Jan 2016)” The market wants some of the most beaten down equities to rally, including Energy Transfer Equity (ETE) and Energy Transfer Partners (ETP), which have fallen devastatingly from their respective peaks of $35 and near-$70 per share, respectively. If you’re not looking at charts, you’re leaving a lot of free information on the table. Energy master limited partnerships, … Read more

Your Hard-Earned Money

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By Brian Nelson, CFA It was Thursday afternoon, February 11, crude oil prices just hit a 13-year low, and the S&P 500 (SPY) was about to break below key technical support. Then, just as the markets were to fall further, rumors again emerged that OPEC may be scheduling a meeting to curb crude oil output, driving crude oil prices from the depths and the market higher off technical support. A barrel of crude oil continues to trade below the $30 mark, but it was quite the “save.” From where we stand, the market hasn’t been this fragile than at any time during the past decade or so, including during much of the Financial Crisis. Optimists may be whistling past the … Read more

Google…Ahem…Alphabet!

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“A falling stock price doesn’t mean the stock is cheaper; it doesn’t mean that the stock will go back up; and it certainly doesn’t mean that the stock can’t fall further. In some cases, a falling stock can become more expensive as it drops, if its value falls by a greater amount.” – Brian Nelson, CFA The company formerly known as Google, Alphabet (GOOG, GOOGL), is surging in after-hours trading February 1. As a result of Google’s stock split in 2014, we include both share classes (non-voting Class C, GOOG, and Class A, GOOGL) in the Best Ideas Newsletter portfolio, collectively one of its largest holdings (5%+). Alphabet, then known as Google, first registered a 10 on the Valuentum Buying … Read more