WMT

No Recession At Walmart; Estee Lauder Not Cheap

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Image Source: Mike Mozart Walmart’s results were quite reassuring regarding the health of the economy. There are also pockets of significant strength, with prestige beauty being catapulted by a “selfie generation.”  By Brian Nelson, CFA No Recession At Walmart Following what can best be described as “carnage” across the retail sector when Macy’s reported August 14, Walmart (WMT) eased some of the concerns in the retail sector when the bellwether reported August 15. Although Amazon (AMZN) seems to get most of the attention when it comes to assessing the health of the consumer, Walmart remains twice as large, as measured by revenue. Walmart generated ~$514 billion in revenue during its last fiscal year, while Amazon hauled in ~$233 billion. If the … Read more

Macy’s Cuts Guidance, Dividend Cut Could Be on the Horizon

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Image Source: Macy’s Inc – IR Presentation By Callum Turcan Retailers (XRT, RTH) have been struggling as the e-commerce shift has stressed margins and hurt foot traffic at stores and malls all across America. Macy’s Inc (M) had fared better than most, but that’s beginning to change. The company reported second quarter FY2019 earnings on August 14 which came with a guidance cut that saw shares of Macy’s plummet below their late-2017 lows. While Macy’s recovered throughout the trading day, the market is clearly signaling that investors are expecting more pain is ahead. As of this writing, shares of Macy’s yield ~9.0%, a major red flag. Guidance Cut Management cut earnings guidance for the full fiscal year while keeping estimates … Read more

Thought Piece: The Hidden Advantage

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As activist investing proliferates, investors are becoming more and more familiar with celebrity investing gurus such as Carl Icahn and David Einhorn. Let’s examine how these investing giants have carved out a unique structural advantage over mom-and-pop investors. This article was originally published in June 2014. By Brian Nelson, CFA Wouldn’t it be great to load up on options and then announce to the world that you’ve done so, thereby generating tremendous gains as other investors pile into the stock driving its price higher? I think most investors either believe that such behavior is mere fantasy, or would love to have this significant influence for their own use, assuming it was legal. Perhaps to your surprise, this behavior is neither … Read more

Sprouts’ Growth Spurt Followed by Weak Operating Margins and Terrible Guidance

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Image Source: Sprouts Farmers Market Inc – IR Presentation By Callum Turcan Sprouts Farmers Market Inc (SFM) is a grocery chain that focuses heavily on selling organic foods, healthy foods, and other higher priced items in nearly two dozen US states through 331 stores as of August 1. The company does not pay out a common dividend at this time, and please keep in mind Sprouts’ fiscal year and calendar are slightly different (fiscal year 2018 ended on December 30). While Sprouts has a lot of room to grow as it enters new domestic markets, we caution that the company is operating in a very competitive industry and shares of SFM already appear fully valued, if not generously valued, as … Read more

Cisco Delivers, Deere Disappoints, Pinterest Plummets, More Reports

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Cisco Delivers, Deere Disappoints, Pinterest Plummets, More Reports — In alphabetical order by ticker symbol: AMAT, BIDU, CSCO, DE, FLO, INTC, JACK, PINS, WMT — Applied Materials (AMAT): Applied Materials reported better-than-expected second-quarter fiscal 2019 results May 16, but the headline print wasn’t that exciting. Revenue dropped 23%, its operating margin gave back 6.3 percentage points, and diluted earnings per share dropped 34%, but the results were “toward the top-end of (its) guidance range, reflecting solid execution across the company in a business environment that remains challenging.” The chip-maker’s risk profile is too high for our taste, and we just have a hard time getting comfortable with the instability of operating results. We value shares of Applied Materials at $48 each, … Read more

Markets Swooning, Expect Extreme Volatility, Finger on Put-Option Trigger

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Image shown: We notified members December 26 that we had  moved  the Best Ideas Newsletter portfolio and Dividend Growth Newsletter portfolio to a “fully invested” position, from a 30% and 20% cash “weighting” at the high end of the range, respectively.  — No change to simulated newsletter portfolios…at this time.  — Hi everyone, — Hope you’re navigating these tumultuous markets well.   — If you recall, during the holiday season last year, we had moved the Best Ideas Newsletter portfolio and Dividend Growth Newsletter portfolio to “fully invested.” See image above (point of the arrow). Because many members were traveling and out of the office, not all were able to read the notification until a week or two after. They were … Read more

ATTN: Advisors and Planners — Disruption Is Looming

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“With the commoditization of investment advice and intense competition from robos and other more cost-efficient solutions, growth-minded advisors want to create bespoke experiences for clients.” — WealthManagement.com By Brian Nelson, CFA Hi Valuentum members, colleagues and friends, Valuentum has a large subscriber base and is one of the most successful paid subscription financial information websites launched this decade. Over the past eight years or so, individuals, financial advisors and money managers from all over the world have subscribed to our services. We pride ourselves on independence and transparency, and we’re a champion of the investor. Today, I’d like to talk directly to our financial advisor, financial planner, and professional money-manager members. You probably already heard the news yesterday: Charles Schwab, which handles … Read more

DG Newsletter Alert, Markets on a Roll! New Highs Coming?

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Image shown: We notified members December 26 that we had moved the Best Ideas Newsletter portfolio and Dividend Growth Newsletter portfolio to a “fully invested” position, from a 30% and 20% cash “weighting” at the high end of the range, respectively. It doesn’t look like the timing could have been much better.  Changes to Dividend Growth Newsletter portfolio Removing Novartis (NVS) -3.5%-5.5% Adding Health Care Select Sector SPDR Fund (XLV) +3.5%-5.5% By Brian Nelson, CFA The back half of 2018 was among the most exciting in Valuentum’s history. For one, we might have made one of our best “market-direction” calls since inception in practically calling the near-term bottom December 26. In hindsight, it’s clear the market had overreacted, but at the time, going to “fully … Read more

Valuentum’s Stock and Data Screens and Screeners

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Let’s go over where to find Valuentum’s stock and data screens and screeners. We believe our stock screeners are among the most robust when it comes to providing forward-looking data, and our data comes straight from our enterprise discounted cash flow models that we use to derive a company’s fair value estimate. By The Valuentum Team In late 2017, we made the decision to transition to providing an updated Excel download each week to members in order to allow them to facilitate any combination of screening criteria they want with respect to our vast amounts of data, whether it be the Valuentum Buying Index, the Dividend Cushion ratio or other. What we’ve found out the past 15 months or so … Read more

News Roundup: Tesla, Gap, eBay, Stericycle, Foot Locker, and Monster Beverage

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  No changes to newsletter portfolios By Brian Nelson, CFA There’s a lot of news out on the first day of March 2019. Tesla’s (TSLA) big reveal was that it will be moving strictly to online purchases in a cost-savings move and that it now has the efficiencies in place to roll out a more-affordable $35,000 Model 3. We’re excited about the development, but we have to admit that we’re still skeptical of the company’s long-term success given the fierceness of the competitive environment, not the least of which is the electronic line-up at General Motors (GM), which remains an idea in both the Best Ideas Newsletter portfolio and Dividend Growth Newsletter portfolio. As it relates to other news, Gap … Read more