XLE

First Quarter 2017 Comes To A Close

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“Be sure to continue to study the difference between price and value—just because a stock’s price has advanced doesn’t make it more expensive if the value of its enterprise has increased at a faster rate. If you understand this concept, you may be smarter than 99.9% of the investing population.” – Brian Nelson, CFA By Brian Nelson, CFA The first quarter of 2017 came and went. Including dividends, the S&P 500 (SPY) roared nearly 6% higher during the period thanks to solid gains from the land of technology, an area that we have liked for the longest time. The Technology Select Sector SPDR (XLK) advanced more than 10% during the period, and key technology holdings in the Dividend Growth Newsletter … Read more

Exxon Mobil Still Battling Back

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Exxon Mobil’s reported results are improving as the global oil markets continue to work towards rebalancing. Let’s take a look at the most recent quarter of one of our favorite oil and gas majors. By Kris Rosemann In light of the well-publicized recent dividend cuts at ConocoPhillips (COP) and Kinder Morgan (KMI), it’s no surprise to readers why we continue to prefer the diversified Energy Select SPDR ETF (XLE) when it comes to energy exposure in the newsletter portfolios. Operating debt-heavy, capital-intensive business models in a violently cyclical industry such as upstream exploration and production can be a recipe for disaster, as the fallout of 2015 showed. Exxon Mobil (XOM), however, continues to be one of our favorite income ideas … Read more

Kinder Morgan Continues to Chop Down Its Debt Load

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Image Source: Loren Kerns By Brian Nelson, CFA After a rough go at it, pipeline operator Kinder Morgan (KMI) continues to get its financial house in order, and we applaud management for its continued strong efforts in this regard. The corporate released fourth-quarter results January 18, and while they came in a little light, we see no reason to change our fair value estimate for shares at this time. In many ways, management’s ongoing reiteration of its goal to work toward reaching its targeted level of ~5 times net-to-adjusted EBITDA is admirable, and we’re hoping ongoing deleveraging initiatives coupled with prudent investment in growth projects (Trans Mountain expansion project and Elba Island Liquefaction project) will pave the way for future … Read more

Dividend Growth Newsletter: Evaluating Our 2016 Dividend Growth Picks

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“…the average return of our dividend growth picks has blown the return of the S&P 500 out of the water during the past two years, and in each of the past two years.” By Brian Nelson, CFA What say us of our dividend growth stock-selection skills? First, on a portfolio level, I am very proud to say that the Dividend Growth Newsletter portfolio has advanced in each of the past two years, while the SPDR S&P Dividend ETF (SDY) has been significantly more volatile, declining during 2015, and bouncing back during 2016. For supposedly steady-eddy dividend growth indices, they tend to be quite volatile relative to the Valuentum Dividend Growth Newsletter portfolio, one of the main reasons why I don’t … Read more

Image: Returns Following the Trump Victory

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To download the table for easier viewing, please select the link . Financials: Trump’s Treasury Secretary choice Steven Mnuchin wants to repeal most of the burdensome Dodd-Frank legislation. A steepening yield curve is helping banks and may drive improved net interest margins in coming periods. Goldman Sachs is ripping higher, leading the Dow’s charge.   Crude Oil: The world is moving to a better balance in supply/demand dynamics in the energy markets. OPEC is talking, has agreed to cuts, and expectations for improved economic growth are helping energy resource pricing. High-beta companies such as Continental Resources are rallying hard.   Energy: Capital spending cuts are bolstering free cash flow in the upstream space as energy resource pricing improves. Reduced regulations could help … Read more

Tough Month – My Goodness

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By Brian Nelson, CFA The market rallied hard this month and seemed to leave a lot of the Dividend Growth Newsletter portfolio ideas behind. I’m not going to sugarcoat the results: The Dividend Growth Newsletter portfolio disappointed this month, and for that I’m sorry.  A lot of it may be “explainable” in light of what happened on Election Day 2016, however. I think a lot of investors have shifted capital from the stronger dividend payers to the more-speculative ones in hopes that a new, pro-business Trump administration will be their saving grace. We hope so, but Trump cannot be President forever, and dividend growth investors should consider a long-term perspective, in my opinion, especially when it comes to compounding payouts … Read more

This Oil Stock Is Surging!

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The Valuentum analyst team digs into recent developments in the oil and gas space and highlights one of the most leveraged ways to play rising crude oil prices. ~12 mins. If you cannot view the podcast below, please select the link here or view the transcript that follows. Tickerized for Valuentum’s oil and gas coverage universe. Chris Araos: Hello, this is Christopher Araos at Valuentum Securities, and today with us is Brian Nelson and Kris Rosemann. Today, we are going to talk about the outlook on oil and gas. Brian Nelson, CFA: Thanks Mr. Araos. I think to kind of set the stage for this conversation, we probably need to bridge the gap between what was truly the depths of … Read more

Podcast: Markets In Motion

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The Valuentum analyst team covers market moving information that is top of mind from consumer staples valuations, the political election cycle, utility valuations, energy resource pricing, biotech considerations, Brexit uncertainty and beyond. ~8 minutes. Tickerized for several consumer staples entities and ETFs, several companies in the energy sector, emerging market vehicles and more.

Pop the Bubbly? Everyone Is Getting Rich

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Image Source: Bryan Rosengrant “Imagine a bank that pays negative interest. In this upside-down world, borrowers get paid and savers penalized. Crazy as it sounds, several of Europe’s central banks cut key interest rates below zero in 2014, and now Japan has followed…some 500 million people in a quarter of the world economy (are) living with rates in the red.” — Bloomberg By Brian Nelson, CFA In April 1979, Paul Volcker became the Chairman of the Federal Reserve, and after a series of rate hikes, the federal funds rate reached a high of 20 points by the end of the year and into 1980. Though the move was to combat double-digit inflation at the time, it’s worth pondering what such … Read more

The Market – On Its Head

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By Brian Nelson, CFA The sector/theme returns have almost been turned on their head as some of the worst performers in the first few weeks of 2016, namely materials (XLB), energy MLPs (AMLP, AMZ), and energy (XLE), have transformed into leaders through the latest data update, April 21. As we outlined in “Alerts: Adding More High-Quality Exposure, (April 2016)” the dividend “track record” growth craze is on, in our view, and yield-rich exposures from utilities (XLU) to the dividend-growth focus itself (SDY) have rallied more than 9% in the year thus far. The metals gold (GLD) and silver (SLV) have also proved to be good trades out of the gates thus far in 2016, up ~18% and 23%, respectively, though … Read more