TYC

Something New!

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Hi everyone: To stay true to our mission, you’ll find something new regarding our methodology. In the coming weeks, you’ll see this table in our work going forward. We just wanted to let you know. We appreciate your membership very much!   ——————————————— About Our Name But how, you will ask, does one decide what [stocks are] “attractive”? Most analysts feel they must choose between two approaches customarily thought to be in opposition: “value” and “growth,”…We view that as fuzzy thinking…Growth is always a component of value [and] the very term “value investing” is redundant.                          — Warren Buffett, Berkshire Hathaway annual report, 1992 At Valuentum, we take Buffett’s thoughts one step further. We think the best opportunities arise from an understanding of … Read more

New Payment Option! Valuentum Research Update!

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Hi everyone: — We’re excited to say that we’re adding additional payment flexibility at Valuentum. — Many members have expressed interest in paying via other providers, and we have added Square to the mix. You can use credit or debit card or bank (ACH) to pay via invoice. — With all of the goings-on in the financial technology and payments space, we wanted to continue to provide members options to pay their memberships how they want and through who they want. You can always reach out to us at info@valuentum.com. — You’ll notice that we’ve also tightened our focus at Valuentum during the past 12-24 months in advance of what has certainly become a more difficult 2022 than even some … Read more

Commodity Price Pressures Dinging Industrial Bellwether Expectations

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By Kris Rosemann Commodity resource prices, while suppressed, are said to be stabilizing, but stabilization at low levels does little good for many operators tied to commodity-based end markets. Such is the case for several industrial giants General Electric (GE), 3M (MMM), and Caterpillar (CAT), all of which have seen their worldwide operations impacted by the effect that a prolonged trough in commodity prices has had on global economic growth, “Industrial Bellwethers Hit by Global Economic Growth Concerns.” We recently highlighted the organic growth pressures industrial bellwether Honeywell (HON) has been experiencing, “Honeywell’s Stock Up 170% Since End of 2009; GE a Better Bet?” and its peers have been echoing its concerns. GE reported third-quarter earnings October 21, and while … Read more

Johnson Controls and Tyco Announce First Major Merger of 2016

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By Kris Rosemann Despite expectations that M&A activity would remain subdued due to the high level of volatility in the markets, Johnson Controls (JCI) and Tyco (TYC) have announced the first major merger in 2016, creating a leader in building products and technology. Under the terms of the deal, Johnson Controls shareholders will own ~56% of the combined company and receive an aggregate cash consideration of $3.9 billion while current Tyco shareholders will own the remaining 44% of the company. The current terms of the deal represent an 11% premium to Tyco’s January 22 closing price for Tyco shareholders. Immediately prior to the merger, Tyco will undergo a reverse stock split that will result in Tyco shareholders receiving a fixed … Read more

Valuentum Economic Castleâ„¢ Rating Update

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Read: Keeping the Horse Before the Cart: Valuentum’s Economic Castle™ Rating The Economic Castle Focuses on the Magnitude of Economic Value Creation The Valuentum Economic Castle™ rating is an enhancement of the competitive advantage framework (commonly known as economic moat analysis) that has become widespread and ubiquitous within the investing world. Whereas an economic moat framework evaluates a firm on the basis of the sustainability and durability of its competitive advantages, Valuentum’s Economic Castle™ rating evaluates a firm on the basis of the firm’s future economic profit spread (return on invested capital less its weighted average cost of capital). The companies with the strongest Valuentum Economic Castle™ ratings are poised to generate the most economic value for shareholders in the … Read more

Industrial Conglomerates Dominate News on Friday

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The latter part of this week brought about a plethora of news from the ‘Industrial Conglomerates’ industry. On Friday, General Electric (GE) announced a 16% increase to its quarterly dividend to $0.22 per share (a 3.3% annual yield). The industrial behemoth was just added to the portfolio of our Dividend Growth Newsletter October 21 on account of its fantastic Dividend Cushion score and solid third-quarter performance. General Electric’s dividend report will be updated with the new information shortly. Also on Friday, Honeywell (HON) approved an authorization to repurchase up to $5 billion of its common stock, now that the firm’s previous $3 billion share repurchase program approved in 2011 is substantially complete. We encourage Honeywell management to be a bit … Read more

Nelson Peltz Shakes Up Ingersoll Rand

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Industrial conglomerate Ingersoll Rand (click ticker for report: ) announced plans to spin off the firm’s security division, buy back $2 billion worth of stock, and raise its dividend 31%, to $0.21 per share. The announcement is a reaction to the activist stake taken by Trian Fund Management, the fund co-founded by Nelson Peltz. Trian owns about 7% of the company. The security division will be a combined unit of the Securities Technology segment and the firm’s residential security business, which is currently housed in the Residential Solutions segment. Annual revenues are expected to be about $2 billion, and the new company will have strong margins and free cash flow, according to management. This creates another security pure play, as … Read more