QCOM

We Said 2016 Was Going to Be a Big One for Intel; FVE: $38

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Image Source: Thomas Cloer Last October, we wrote that “Intel May Have a Breakout Year in 2016,” and despite the rough start to the year, our thesis continues to progress nicely. Here’s what we wrote several months ago: Part of the reason why we like Intel (INTC) is that many continue to dismiss the firm’s entrance into the mobile market, an area traditionally dominated by Qualcomm (QCOM). It is widely-accepted that Intel’s research and development prowess has nearly put AMD (AMD) out of business, and we’re confident the chip giant’s resources and innovation track record will open the door to the mobile market in a big way. In March (2015), it was reported that Intel’s technology will find its way … Read more

Apple Will Go Lower… And It Will Be “Forced” Into Acquisitions

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By Brian Nelson, CFA We have a few regrets for not “lightening up” more on the position in Apple (AAPL) in the newsletter portfolios during the past few weeks, “Looking to Trim Apple…” and while our lack of action may cost the newsletter portfolios a few basis points in the near term, we’re not too concerned. For one, in this “type” of market, we want to stick with quality, and Apple fits that bill quite well, particularly with the cushion that its balance sheet provides. The iPhone giant’s equity price may go lower as some sell the “headlines” around its fiscal 2016 performance, but the company’s financial health puts it in a class by itself, in our view. The Journal … Read more

The 20 Something’s Stock Portfolio

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A version of this article appeared on our website March 31, 2015. <Our best ideas at any time are included in the Best Ideas Newsletter portfolio and Dividend Growth Newsletter portfolio.> The “20 Something’s Stock Portfolio” is the first in a series of articles where we get to the core of what many brand new investors want to do when they are first introduced to the stock market: find exciting companies that they are familiar with that will help compound their wealth over time. Other portfolios that we will share in this series include “The Ultra High Income Portfolio,” “The Economic Castle Portfolio,” “The Dividend Cushion Portfolio,” and “The Intelligent ETF Investor’s Portfolio,” among others. The series of portfolios will … Read more

Intel May Have a Breakout Year in 2016

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Intel’s (INTC) third-quarter results, released October 14, didn’t turn many heads, but the company did beat expectations on both the top and bottom lines, performance that was well-received by the market. Revenue generated in the quarter was approximately flat on a year-over-year basis, but the mark did beat the consensus estimate by $250 million. The chip giant’s earnings of $0.64 per share in the quarter exceeded expectations by a nickel per share. It wasn’t a bad showing by any stretch of the imagination, but Intel continues to feel the pain of a shrinking personal computing market, even as optimism flies high with respect to the firm’s 6th Gen Intel Core processors. Revenue from Intel’s Data Center Group, which includes server, … Read more

Video: Are Economic Moats Priced Into Stock Prices? — You Bet They Are

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President of Equity Research Brian Nelson debunks the myth that the economic moat is not included in stock prices. Length: ~8 minutes. Tickerized for firms in the Morningstar Wide Moat ETF (MOAT), as of October 14, 2015. Brian Nelson, CFA: This is Brian Nelson from Valuentum Securities. I wanted to talk about an important concept and answer an important question. Is Warren Buffet’s economic moat priced into stock prices? Before I answer that question, I think we need to define a couple things. Return on invested capital is a measure of a business’ performance. It’s calculated as earnings before interest divided by net new investment, which is a measure of return on new invested capital. So what is the return the … Read more

Batten Down the Hatches – Another US Market Crash Probable

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A global financial contagion like that of the Financial Crisis just six short years ago cannot be ruled out. The magnitude of wealth lost in China’s (FXI) equity market is simply staggering, and we’re already witnessing bad loans soar across China’s Big 4 banks. We’re hearing that property, used as collateral for stock margin trading in China, is often being sold for 90 cents on the dollar as speculators look to cover losses. We expect the fallout from the collapse in Chinese equity markets to eventually reverberate through their property markets, impacting loan-to-values in the commercial and residential arenas, sparking significant loss rates and asset write-downs across the Chinese financial system. We continue to assess the tangible evidence of an … Read more

Intel Looks to Mobile to Overcome PC Weakness

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Intel (INTC) reduced its revenue guidance March 12, dropping expectations for the first quarter to $12.8 billion from $13.7 billion. The world’s largest semiconductor chip maker pointed to weaker-than-expected PC demand, as well as lower inventory levels in the PC supply chain. As far as Intel is concerned, management cited a lack of Windows XP refreshes from small and medium businesses, along with worsening macroeconomic conditions and currency headwinds as main factors in the decline.  Despite the reduction in revenue guidance, the mid-point gross margin expectations remain at ~60% for the period due to higher average selling prices offsetting any profit deleveraging caused by the lower expected volume of PC sales. The firm’s R&D and MG&A spending and depreciation expectations … Read more

A Sneak Peek at Valuentum’s Slides for the AAII Presentation in Chicago This Saturday!

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Let’s take a sneak peek at President Brian Nelson’s slides for this weekend’s presentation in Chicago! Firms mentioned: MSFT, GOOG, AIR, BRCM, CSCO, SPY, AAPL, QCOM, MA, DPZ, SVU, RNDY, DDE, STRA, EXC, CLF, PBI, CTL, JCP and others. <select image to download the slide deck>

Third Quarter Earnings Season Pushes Forward

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The equity markets continue to propel higher despite what we would describe to be a mixed third-quarter earnings season. Let’s walk through a number of earnings reports from popular companies reporting so far this week. Some of them we include in the newsletter portfolios. Others we don’t. But all are worth keeping tabs on. Annaly (NLY) Annaly is a mortgage REIT (mREIT) with principal business objective to generate net income for distribution to shareholders. Being critical of the mREIT business is certainly unpopular, and we understand that many retirees generate vital income streams from such investments. Bulls and bears, however, both benefit from our independent voice, and we call out risks as we see them. Annaly and American Capital Agency … Read more