TWTR

Twitter Working Backwards?

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Image Source: Xiaobin Liu The social media platform known for its tweets faced selling pressure after reports surfaced that it had removed 70 million fake accounts from its website. Social media is still a relatively young technology, and our top idea in the space remains the cash-rich Facebook. By Kris Rosemann Shares of Twitter (TWTR) fell more than 5% during the trading session July 9, less severe than the drop had been at its session worst, following a report from The Washington Post outlining the company’s suspension of 70 million fake or spam accounts in the months of May and June. Twitter had 336 million monthly active users as of the end of the first quarter of 2018, but company officials … 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).

Twitter’s Problems: Slow Growth in the US and Low-ROI for Small Business

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Image Source: Xiaobin Lui We like Twitter’s improved free cash flow generation and net cash position on the balance sheet, but it’s too hard for small businesses to build customer trust on the platform, and the lack of engagement from followers at mom-and-pop businesses is almost hard to believe. It seems like Twitter remains primarily a distribution platform for politicians, the media and celebrities, those already having exposure from other avenues. Small, mom-and-pop businesses – the bread and butter behind future advertising revenue at Twitter – can’t make Twitter work for them as returns on their investment remain minimal, at best. By Brian Nelson, CFA We had warmed up to Twitter (TWTR) in February because we thought the platform may … Read more

ICYMI: Valuentum’s Improved Stock and ETF Web Pages

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Valuentum has rolled out improved stock and ETF web pages on its website valuentum.com/. Now, subscribers can access key proprietary information on the stock and ETF web pages in addition to the customary stock and ETF reports. Dear reader, We have some exciting news that we can’t wait to share with you! At valuentum.com/, we have rolled out new stock and ETF pages that conveniently include a variety of our proprietary metrics from the Dividend Cushion ratio to the Economic Castle rating and beyond! There’s even mouseover functionality so you can learn about how we define the key metrics across our stock-selection and dividend growth methodologies. You’ll still have access to the stock and dividend reports on the landing pages, … Read more

Value Investors Starting to Salivate Over Facebook’s Fall

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Image Source: DonkeyHotey Facebook is becoming a value investor’s dream: a stock with fantastic free cash flow generation and balance sheet health dealing with transient headline noise. We’re waiting for shares to start to turn upward before we would consider adding to the hypothetical weighting in the simulated Best Ideas Newsletter portfolio. They look cheap! By Brian Nelson, CFA Facebook’s (FB) fall from grace has been a dream come true for many value investors looking for a company with a pristine balance sheet and tremendous free cash flow generation. By a pristine balance sheet, we mean a huge net cash position (~$41.7 billion) and no debt. By tremendous free cash flow generation, we mean that Facebook hauled in $5.4 billion … Read more

Market Overreacts to Facebook News

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Image Source: Christopher The headline news seems concerning, but we’re taking a long-term perspective with Facebook. We doubt the news will meaningfully impact the trajectory of growth of its long-term free cash flow, and we’re not reading too much into events that seem heavily-influenced by the overheated political environment. By Brian Nelson, CFA Investors are overreacting and selling shares of Facebook (FB) March 19 because they are worried about implications of a UK probe and a state investigation into the practices of Cambridge Analytica, a privately-held data mining and analysis company, and whether the way Cambridge Analytica acquired and applied data from users of Facebook was legal. The New York Times first broke the story when the paper published a … Read more

The “Luck” and “Randomness” of Index Funds

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Please select the image below to download the document. Image shown, page 1 of 14. Tickerized for Valuentum’s coverage universe.

Facebook – Still One of Our Favorites

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Image Source: Facebook Let’s not beat around the bush with this article. Let’s talk about why we like Facebook in layman’s terms. The company is a veritable free-cash-flow generating powerhouse, and its balance sheet is pristine. We value shares at $238 each, and its rating of 7 on the Valuentum Buying Index isn’t bad considering the frothiness of the market. By Brian Nelson, CFA Shake off the idea that technology is riskier than any other sector because it might not be. Don’t worry about the concept of “fake news” tarnishing the Facebook (FB) brand, as that’s just noise. Facebook operates at the heart of society, and while there will inevitably be changes to its platform along the way, literally everyone … Read more

Rising Risk Free Rates Threatening Market, Removing CVS and Hanesbrands

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The most important variable to keep your eye on, the 10-year Treasury, is rising, and the long-term implications on equity values could be considerable. We don’t think the moves thus far have been too disruptive, but continued concerns over US tax receipts and infrastructure/defense spending could send sovereign yields roaring higher. As fourth-quarter earnings season marches on, let’s take a look at some meaningful recent quarterly reports. We’re also shedding two companies from the simulated newsletter portfolios. By Kris Rosemann and Brian Nelson, CFA The market continues to be on edge as it considers what the borrowing cost of US debt might be in the event of the next downturn, the timing the only uncertainty, now that it has significantly … Read more

2018 Starts Out with a Bang!

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Image Shown: An ETF that measures momentum (MTUM) has done considerably better than the S&P 500 since the beginning of 2017. Among its top 5 holdings are Microsoft (MSFT), Apple (AAPL), Boeing (BA)—newsletter holdings that have had excellent value characteristics along the way. Visa (V) is also included in its top 10 holdings.

Even some the most bullish and optimistic investors have been surprised by the resiliency of today’s market environment. Why does it seem appropriate to remind members that the stock market doesn’t always go straight up with almost no volatility?