V

A “Terrible” Negative Alpha-Generating “Trade” and More

by

Let’s walk through some of the news before the Thanksgiving holiday, and one of the bigger missteps we made during 2017. By Brian Nelson, CFA I’d like to run through the news before many of you take a break for the Thanksgiving holiday. Thanks again for your attention. It means the world to our team that you see and understand the things that we’re doing, the great calls we make with our top-weighted ideas (see here and here), the extensive valuation processes we perform with respect to the discounted cash-flow process (see here), and how we provide that in downloadable pdf form (see here) – and we’re here to talk about our expectations! You can get reports from anybody, of … Read more

Valuentum’s “Home Runs” During 2017

by

Image Source: Keith Allison By Brian Nelson, CFA We’re doing a lot of things right, but you (yes, you!) mean the world to our team. For best ideas, see the portfolio on page 8 of the Best Ideas Newsletter here (pdf). For best dividend growth ideas, see the portfolio on page 5 of the Dividend Growth Newsletter here (pdf). I want to make sure you have these at your fingertips. We appreciate your business so much! We wrote up an analysis of ideas that were included in the Best Ideas Newsletter portfolio and Dividend Growth Newsletter portfolio at the beginning of 2017. The ideas included in these respective portfolios are our best ideas for each respective strategy, with two distinctions … Read more

How Have Our “Best Ideas” Performed During 2017?

by

The top-weighted ideas are getting the job done, while we avoided one of the biggest missteps in all of 2017. We’ve had better years, but 2017 was still a great one. Key takeaways: 1) “The top-weighted ideas in the Best Ideas Newsletter portfolio, Apple and Visa, performed wonderfully from the release of the December 2016 newsletter through November 13, 2017, averaging more than an increase of 45%, excluding dividends, versus a mid-teens percentage advance for the S&P 500, excluding dividends.” 2) “The weighting concept within a portfolio context is an important one because, as a portfolio manager adds more and more ideas to the portfolio, the next best idea is just that–the next best one–so the probability of diluting portfolio … Read more

Does Visa Ever Disappoint?

by

Image Source: Visa The credit card network hit all-time highs today. We continue to be huge fans of the company’s fundamentals. By Brian Nelson, CFA Another day, another new high for top-weighted idea in the Best Ideas Newsletter portfolio, Visa (V). Briefing Investor said it succinctly: Visa…is trading at a new all-time high after the company reported better than expected fourth quarter results and gave encouraging guidance for fiscal 2018… Visa owns a global payment network. Unlike American Express (AXP) and Discover (DFS), which own payment networks and issue credit, Visa doesn’t take any credit risk — Capital One (COF) is a bank that issues a lot of credit cards. Visa is a technology company in the financial sector, just … Read more

The Market Loves PayPal; Shares Now $70+

by

Image Shown: PayPal’s stock has been a huge winner in the Best Ideas Newsletter portfolio.  Payments processor PayPal reported fantastic third-quarter results and raised its full-year guidance for the third time in as many quarters. Shares are surging. By Brian Nelson, CFA We thought PayPal’s (PYPL) second-quarter results were fantastic, but its third-quarter results, released October 19, were even better. For a little background, here’s what we said about PayPal in July: PayPal’s revenue advanced 20% in the second quarter, after excluding effects from currency exchange, and the company leveraged that growth into an impressive 27% jump in GAAP and non-GAAP earnings per share, the latter to $0.46, coming in ahead of expectations. PayPal added 6.5 million active customer accounts … Read more

Boeing, Visa Top Dow Performers Thus Far in 2017

by

Image Source: Ken Mist Two of our favorite ideas have been leading the pack. By Brian Nelson, CFA We don’t send newsletter notifications often. In fact, they are few and far between. But when we do highlight an idea for the newsletter portfolios, we want it to be a good one. On Friday, 24/7 Wall Street reported that Boeing (BA) had increased its lead as the Dow Jones Industrial Average’s (DIA) top performer during 2017, with the year-to-date mark reaching nearly 65%, as of the end of last week. If you recall, on January 26, we “added” the idea to the Dividend Growth Newsletter portfolio at $168.44, making it perhaps one of the best large-cap ideas highlighted anywhere during 2017. … Read more

The Wisdom of Oaktree’s Howard Marks

by

Image Source: emmolos The latest memo from Oaktree’s Howard Marks here should be read and then read again. The section on passive investing is an absolute treasure. “Passive investing is done in vehicles that make no judgments about the soundness of companies and the fairness of prices.  More than $1 billion is flowing daily to “passive managers” (there’s an oxymoron for you) who buy regardless of price.  I’ve always viewed index funds as “freeloaders” who make use of the consensus decisions of active investors for free.  How comfortable can investors be these days, now that fewer and fewer active decisions are being made?” — Howard Marks, Oaktree Capital Financial Tech Services: ACIW, EPAY, FDC, FIS, FISV, FLT, GPN, MA, MELI, … Read more

Let’s Talk Business Analysis

by

Valuentum’s Brian Nelson explains the benefits of combining both economic moat and economic castle analysis in business analysis. An excerpt from part II of Valuentum’s four-part investment education workshop. If you cannot see the video, please view the transcript below or select the link here. If you would like to purchase Valuentum’s investment education workshop, please visit the page here. Brian Nelson, CFA: “In business I look for economic castles, protected by unbreachable moats… (quoting Warren Buffett).” If you take out some of the prepositions, Warren Buffett looks for economic castles. So what we do is we provide the analysis associated with the Economic Castle rating. The Economic Castle rating is based on the academic framework that suggests that economic profit … Read more

Video: Explaining the Valuentum Buying Index

by

The Valuentum Buying Index (VBI) stands on the shoulders of giants in finance in uncovering investment ideas.  Brian Nelson, CFA: This is Brian Nelson from Valuentum Securities. Today, I would like to talk about our Valuentum Buying Index, the stock selection methodology that we use and apply across our entire coverage universe. But before I get into some of the specifics, I’d like to provide more or less a summary. Essentially what the Valuentum Buying Index does is it highlights undervalued stocks that are going up in price. Undervalued stocks with good momentum…Value-ntum stocks. So, at the core, the Valuentum Buying Index tries to find stocks that we think have a very strong likelihood of equity price appreciation. It breaks … Read more

Stocks in the News: Visa, Microsoft, General Electric

by

Image source: Visa Let’s have a look at the quarterly reports from a few stocks in the news July 21. By Brian Nelson, CFA Visa’s (V) Margin Profile Remains Excellent Top-weighted position in the Best Ideas Newsletter portfolio is approaching the “century mark” after reporting solid fiscal third-quarter results July 20. Visa’s net operating revenue advanced 26% on a year-over-year basis in the quarter thanks in part to the inclusion of Visa Europe, and the company recorded GAAP net income of $2.1 billion, or $0.86 per share, better than consensus expectations. Visa CEO Alfred Kelly noted that performance reflected “strong growth in payments volume, cross-border volume, and processed transactions, which were powered by economic tailwinds in the US and globally.” We … Read more