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Efficacy of the Dividend Cushion Ratio

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A version of this article was originally published September 2019. The Dividend Cushion ratio is one of the most powerful financial tools an income or dividend growth investor can use in conjunction with qualitative dividend analysis. The ratio is one-of-a-kind in that it is both free-cash-flow based and forward looking. Since its creation in 2012, the Dividend Cushion ratio has forewarned readers of approximately 50 dividend cuts. We estimate its efficacy at ~90%. By Valuentum Analysts  Key Takeaways: The Dividend Cushion ratio is a helpful tool to use to cushion your dividend growth or income portfolio against potential dividend cuts. The ratio also helps to assess the growth potential of a company’s dividend, above and beyond current expectations of payout … Read more

US Congress Is Getting Ready to Pass a Massive ~$2.2 Trillion Fiscal Stimulus Bill

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Image Shown: US equities have started to recover some of their lost ground as the likelihood that the US Congress will pass a massive ~$2.2 trillion fiscal stimulus and emergency spending package, dubbed the CARES Act, has increased significantly over the past week as seen through the bounce in the SPDR S&P 500 ETF Trust (SPY). President Trump has clearly indicated that he intends to sign such a bill into law as soon as possible, with the US House of Representatives expected to take up the legislation this upcoming Friday morning on March 27. By Callum Turcan On March 25, the US Senate worked late into the night to secure a bipartisan compromise on a massive ~$2.2 trillion fiscal stimulus … Read more

Don’t Just Look at the House; Examine the Foundation

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Image Source: Lindsay Holmwood Let’s examine how we derive the forecasts in our stock and dividend reports. This article appeared on our website April 2014. It is updated and refreshed today for the benefit of new members. By Kris Rosemann and Brian Nelson, CFA One of the biggest benefits of being a member of Valuentum’s investment services is that we show you all of the numbers – the numbers tell the real story. An author/analyst may tell the story of a company through his/her eyes, but the author/analyst must still convert his/her thoughts and qualitative considerations into quantitative future forecasts to arrive at a fair value estimate of a stock. These future forecasts ultimately determine an intrinsic value estimate of the … Read more

7 Hidden Dividend Aristocrats in Industrials

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Image notes: The price-to-fair value ratio shows the relationship between the company’s stock price and our discounted cash-flow derived fair value estimate. Price is what you pay for the stock, while value is what you get. Price and fair value seldom equal. The savvy investor seeks to find stocks whose price is far below an informed forward-looking cash-flow-based fair value estimate of their intrinsic value. The Dividend Cushion ratio is a proprietary Valuentum measure that drives our assessment of the company’s Dividend Safety rating. The forward-looking measure assesses dividend coverage via the cash characteristics of the business. The Dividend Cushion is a ratio that sums the existing net cash (total cash less total long-term debt) a company has on hand … Read more

ICYMI — Video: Will Hasty Policy Facilitate the Next Leg Down, or Do We Have It Coming Anyway?

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President of Investment Research and award-winning author of Value Trap: Theory of Universal Valuation Brian Nelson explains how US policymakers are stuck between a rock and a hard place, and how the market may be factoring in too high of a probability of a return to normalcy before 2021. This and more in the latest video report. Summary Make sure you review Value Trap on Amazon. Do so here. We think those that bought equities near the bottom of this swoon may be looking to take profits at present levels. The market is currently reflecting an 80%-85% probability of a return to normalcy before 2021, which we believe is too high at this time. Our main concern is that government … Read more

Valuentum’s ETF Reports

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Image Source: GotCredit Welcome to Valuentum’s ETF coverage. If you’re new to the site, please be sure to access the stock reports and dividend reports as part of your membership. If you are looking for the archives to the Best Ideas Newsletter, they can be found here. The Dividend Growth Newsletter archives can be found here. The Exclusive and High Yield Dividend Newsletter have their own website with archives, the latter coming soon. To learn more about Valuentum’s ETF reports, please see  here . To request a report of an ETF we do not currently cover, please contact us. To access the relevant Valuentum reports for each major ETF category, please click on the respective link, “Click Here to Access Valuentum Report.” The links … Read more