SNY

Health Care Sector Remains Hot

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Image Shown: The Health Care Select Sector SPDR ETF, a holding in both our Best Ideas Newsletter and Dividend Growth Newsletter portfolios, has been on an upward tear over the past several years. Strong macro tailwinds combined with the ability for industries within the health care sector to generate meaningful shareholder value have been key to supporting strong capital appreciation of equities operating in the area of late. By Callum Turcan The Health Care Select Sector SPDR ETF (XLV) is a top holding in both our Best Ideas Newsletter and Dividend Growth Newsletter portfolios. We like the exposure and diversification to health care equities that XLV provides. XLV yields ~1.5% as of this writing. State Street Corp (STT) acts as … Read more

Our Reports on Stocks in the Pharmaceuticals – Big Industry

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Image Source: A 4 Structure of the Pharmaceuticals – Big Industry The big pharma industry is primarily composed of makers of branded drugs. Intellectual property protection is vital to the successful commercialization of medicines and offers makers of branded drugs a unique competitive advantage via patents, which can extend for decades. When branded drugs lose market exclusivity, however, makers of generic pharmaceuticals can generate intense price competition, causing drastic revenue losses on unprotected therapies. Long-term success for branded pharma companies depends on a strong and diverse drug pipeline, which can be augmented by M&A activity. We generally like the group and expect continued industry consolidation. We’ve optimized our health care coverage, the reports of which can be found here.

Biotech and Pharma Roundup

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Image Source: e-Magine Art Some big news in the world of biotech and pharmaceuticals has come out this week, starting Monday October 21, that we want to get out in front of our members. In alphabetical order by ticker symbol: BIIB, BMY, MRK, NVS. By Callum Turcan Biogen Inc (BIIB) reported third quarter 2019 earnings on Tuesday October 22 that easily beat both top and bottom line estimates. That was partially due to strong sales at its SPINRAZA offering, which is used to treat spinal muscular atrophy. Shares of BIIB rocketed higher during the trading session as investors priced in the upside that Biogen’s Aducanumab treatment could generate, with the company announcing that it was going to ask the US … Read more

Merck Shows Impressive Margin Expansion

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Image Source: Merck & Co Inc – IR Presentation By Callum Turcan Pharmaceutical giant Merck (MRK) has performed well during the past few fiscal years by reducing operating costs while utilizing strong growth at some of its oncology drug offerings to drive sales higher. Shares of Merck yield 2.7% as of this writing and are trading at the upper half of our fair value estimate range after an impressive run up in Merck’s stock price began in April 2018. Management recently raised Merck’s full-year sales and non-GAAP EPS guidance for 2019, which we will cover in a moment. Enhancing Profitability Levels From 2016 to 2018, Merck cut its GAAP operating expenses from $35.1 billion to $33.6 billion (down over 4%) … Read more

Elanco Buys Bayer’s Animal Health Unit, Gaining Scale and Greater Exposure to the Humanization of Pets” Trend”

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Image Shown: Shares of Elanco Animal Health Inc (ELAN) sold off after the company announced on August 20 it was acquiring Bayer AG’s (BAYRY) animal health unit through a cash and deal stock deal worth $7.6 billion at the time the deal was announced. By Callum Turcan On August 20, Elanco Animal Health Inc (ELAN) agreed to acquire Bayer AG’s (BAYRY) animal health unit for $7.6 billion (at the time the deal was announced) through a cash and stock deal. That includes $5.3 billion in cash and $2.3 billion in stock, keeping in mind shares of ELAN initially shifted lower after the news. Bayer plans to exit its stake in Elanco over time as management seeks to rebuild the company’s … Read more

Tesla and GameStop Face Selling Pressure After Notable Disappointments

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Image Source: Kamil Murat Yılmaz Tesla reported a significant shortfall in its first quarter 2019 deliveries amid global distribution growing pains, which called in to question its ability to deliver on its reiterated guidance for 2019. Meanwhile, video game retailer GameStop continues to face challenges presented by headwinds beyond its control and expects its revenue contraction to accelerate in fiscal 2019. We’re not interested in shares of either company. By Kris Rosemann Tesla’s First Quarter Deliveries Disappoint, But Full Year Guidance Reiterated Electric car maker Tesla (TSLA) stumbled out of the open April 4 after its April 3 release of its first quarter 2019 deliveries figure, which came in markedly short of expectations. 63,000 deliveries in the quarter was more … Read more

Valuentum Stock Screeners

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This article was sent to members via email December 29. That email can be accessed at the link that follows this article. By Brian Nelson, CFA Hi everyone, I wanted to provide an update with respect to Valuentum’s stock screeners. We believe our stock screeners are among the most robust when it comes to providing forward-looking data, or data that is important with respect to the investment decision-making process. We publish screens in each of the monthly newsletters, but we also provide a basic weekly screener for download on the left column of the website, “Download Weekly Stock Screener (xls) — login required.”   We also have other products. The more robust DataScreener, for example, is part of the quarterly Financial … Read more

Market Mayhem — Alerts for Members

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During these extremely volatile times, it’s important to stay focused. On December 15, we informed all of our members to “Pay Attention.” Shortly thereafter, we notified members of the potential for a stock market technical breakdown. This morning, we offered a pre-market briefing about the importance of thinking about portfolio protection. For Best Ideas Newsletter and Dividend Growth Newsletter members: http://campaign.r20.constantcontact.com/render?preview=true&m=1110817109903&ca=e2406cd6-c113-4344-8731-493f33fc44a4&id=preview For High Yield Dividend Newsletter members: http://campaign.r20.constantcontact.com/render?preview=true&m=1110817109903&ca=b3ba530f-38b3-489a-ac96-2961dca89c6b&id=preview For Exclusive members: http://campaign.r20.constantcontact.com/render?preview=true&m=1110817109903&ca=ba6d90c0-4433-48b2-9b8a-aac4ddf9006e&id=preview We’re here for any questions. Please just let us know how we can help! Kind regards, Brian Nelson, CFA  brian@valuentum.com

Valuentum’s Weighted Average Cost of Capital (WACC) Distribution

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The weighted average cost of capital is one of the most subjective measures in corporate finance, but it is also one of the most important ones. “The most important item over time in valuation is obviously interest rates…If interest rates are destined to be at low levels…It makes any stream of earnings from investments worth more money. The bogey is always what government bonds yield….Any investment is worth all the cash you’re going to get out between now and judgment day discounted back. The discounting back is affected by whether you choose interests rates like those of Japan or interest rates like those we had in 1982…When we had 15 percent short-term rates in 1982, it was silly to pay … Read more

Study: Valuentum’s Best Ideas Newsletter Portfolio

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To read the study, please click on the image to download the pdf document (pdf).