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Portfolio Changes For The First Quarter Of 2015
- Volatililty can fray nerves yet may also offer opportunities.
- The first quarter was marked with quite a bit of volatility, which I have used to my advantage.
- The article below will detail the changes made to my portfolio along with the reasons why.
Sinclair Broadcast Group: Prodigious Cash Flow Augurs Well For Additional Upside
- Sinclair Broadcast Group offers current investors a compelling play on the changing landscape of the broadcast TV business.
- The company in its current form is slated to generate a free cash flow yield of over 35% during the next two years.
- The 2016 spectrum sale maybe a watershed event for the industry as broadcasters may look to monetize their assets.
- The median value of SBGI using the FCC method is over $45 per share, a significant premium to where the shares are currently trading for.
Why I Sold Out Of Exxon Mobil
- The price of crude oil is in a proverbial free fall since the middle of last year.
- Many believe the price will rebound shortly.
- The recent Exxon Mobil investor day presentation was quite sobering.
- In the article below, I will detail the reasons why I have parted ways with Exxon Mobil.
Illustrating Why Amgen Offers Additional Alpha Versus Gilead Sciences
- The recent release of positive data concerning Kyprolis is a big win for Amgen.
- I expect sales to pick up once the label for Kyprolis expands.
- I have updated my model for Amgen to take this into account as detailed below.
Examining My Bullish Thesis On Citigroup In Light On Yesterday's Announcement
- The successful passing of the CCAR should serve as a catalyst for the shares of Citigroup.
- The Fed granted authorization to increase the dividend to 5 cents per share along with a share repurchase authorization worth over $7 billion dollars.
- The news is a positive yet when taken with the news of the recent Costco credit card win coupled with the disposal of One Main Financial a compelling picture emerges.
- The shares are meaningfully undervalued as will be detailed below.
Illustrating My Decision To Invest In UPS
- UPS is a wide moat company that's trading at a fair price.
- Th recent fourth quarter disappointment has offered long-term investors an attractive entry point into this well-run entity.
- I'm modeling double-digit gains out through 2019 as will be detailed below.
Can The Departure Of Jeff Immelt Hasten GE's Recovery?
- When a company underperforms, an investor will lose faith in the management team.
- Often times, the Board will step up and force out the CEO in an attempt to revitalize the organization.
- Bloomberg reports such an event maybe at hand with General Electric.
- The article below will update my bullish thesis on GE.
Updating My Bullish Thesis On AMC Entertainment
- AMC entertainment continues to outperform this year with the shares up over 30% year to date.
- The 2015 movie slate is shaping up to be quite strong which will galvanize AMC sales.
- AMC has already exceeded my expectations. In light of the companies stellar performance I felt it was prudent to revisit my Levered Returns Model.
Blood In The Water - Time To Buy BP Prudhoe Bay Royalty Trust
- BP Prudhoe Bay Royalty trust is prone to bear raids.
- The precipitous decline seen today is another example of this.
- I have initiated a position in BPT as I view the shares as due for a sharp bounce as detailed below.
Updating My Price Target On Gilead Sciences
- Gilead Sciences recently issued sales guidance for 2015.
- I thought it would be prudent to update the assumptions made in my Levered Returns model.
- I continue to view the company as extraordinary as will be detailed below.
Capturing The Growth Of The Diabetic Epidemic Via Shares Of Novo Nordisk
- Diabetes is at epidemic levels worldwide and growing.
- As the worlds population continues to age and become more sedentary, I expect the in incidence of diabetes to expand.
- Novo Nordisk through its comprehensive line of insulin therapies is at the forefront of this unfortunate trend.
- Novo is expected to launch three novel, treatments that will power shares higher over the balance of the decade.
Fastenal: A Wide-Moat High-Growth Play With A Dividend Approaching 3%
- Fastenal is a true wide-moat company with margins north of 50% over the course of the past decade.
- Fastenal's ability to consistently generate double-digit sales and earnings growth is simply outstanding.
- In typical short-sighted fashion, the market has marked the shares down as they fret over the company adding additional employees.
- The article below will detail my bullish thesis on FAST.
- I expect shares to double over the course of the next decade.
Warren Buffett Increases His Stake In Deere, Is It Time To Buy?
- Deere is a wonderful company that is entering into a cyclical trough.
- The shares are paying an attractive dividend to compensate investors as they await an inevitable cyclical upswing.
- I was particularly heartened to see Berkshire Hathaway currently controls roughly 5% of all the shares outstanding.
Detailing My Bullish Thesis On American Express
- Wide-moat companies are rare creatures that have built a durable "wall" around their business, thus ensuring their profit margin.
- It is not often a wide-moat company trades at a below-market multiple.
- The article below will detail my bullish thesis on American Express.
Viacom Is Trading At A Steep Discount To Its Fair Value
- Viacom has come under intense selling over the past six months.
- The Street has cooled towards the pay TV industry as they believe the business model is under assault.
- The analysts are afraid Dish Networks will drop Viacom's bundle, leading to a loss of the dependable revenue stream when the contract comes up for renewal in 2016.
- I will detail my bullish thesis on Viacom along with a discussion on the company's generous capital return policy.
Detailing Exxon Mobil's Distribution Yield Of 5.4%
- Exxon Mobil operates in the volatile energy field.
- The vertically integrated model that Exxon Mobil employs helps to shield profits from the price swings seen in the commodity space.
- Exxon Mobil's superior business model allows them to consistently pay an ever-rising dividend, making them well suited for the income-seeking investor.
4 Key Points To Look For In Gilead Sciences Earnings Report
- Gilead Sciences remains one of the most intriguing companies in my coverage universe.
- Gilead Sciences revolutionary Hepatitis C program has created an enormous amount of new found profits for the company.
- I have highlighted four key areas I would like to see the company address during the upcoming earnings conference call.
Amgen Offers Impressive Upside As A New Product Cycle Begins
- Amgen is entering into a virtuous new product cycle.
- The plethora of new products should drive sales and earnings higher.
- I remain bullish on the shares for reasons that will be detailed below.
My Bullish Investment Thesis On General Electric
- GE's industrial segments continue to show strong growth with an expectation of $1.10-$1.20 per share in earnings in 2015.
- The GE Capital division continues to perform well, with a spin-off of the remaining stake in Synchrony financial expected shortly.
- The key for GE is to continue to shrink the percentage of profits generated by GE Capital while augmenting its industrial divisions.
- Significant progress will be made in 2015; the shares are quite attractive at their current quote.
Illustrating Why I Choose To Invest In IBM Post Earnings
- IBM's earning report was a bit lackluster as the shares sold off immediately after the release.
- IBM issued guidance for 2015 which indicates the shares are trading deep in value territory.
- A thorough examination of the press release is necessary to get a better understanding of the transformation of the business.
Illustrating Why McDonald's Is Undervalued At Its Current Share Price
- Shares of McDonald's have been stuck in a trading range over the past three years.
- The $100 level seems to be rarefied air for the company as it will slightly exceed the high from the previous year only to give it all back.
- Investors are naturally frustrated by the sideways pattern.
- The Create Your Taste initiative holds as much promise as the McCafe concept.
- A current investor can lock in a generous yield while waiting for the Create Your Taste platform to revive and grow sales and profits.
Illustrating Why I Choose To Invest In IBM Again
- IBM is a value play.
- The shares have under performed the market for the past two years.
- To further compound matters, the shares lost ground in 2014, angering many investors.
- I have decided to reinvest in the shares as will be outlined below.
Taking Advantage Of Foreign Market Weakness To Initiate A Position In Diageo
- Recent market weakness has battered shares.
- The weakness is more pronounced overseas, especially in Europe.
- As a value investor, bargains tend to emerge during prolonged periods of selling.
- Such is the case before us with Diageo. The article below will detail my bullish thesis on DEO.
Gilead Sciences' Recent Trading Pattern Is Much To Do About Nothing
- Shares of Gilead Sciences have been quite volatile over the past 8 weeks.
- Investors feared the decision by Express Scripts to exclude Harvoni would be followed by other insurance providers.
- With the recent announcement by Prime Therapeutics, I believe the fear is overblown.
- The next major catalysts will be in the first week of February, when GILD reports its earnings.
My Expectations For Citigroup In 2015
- Citigroup is clearly undervalued as they are trading at less than liquidation level.
- By trading at less than Tangible Book value a large margin of safety is offered to shareholders.
- All the ingredients are in place for a low risk play with above average gains.
- All Citigroup is waiting for is a catalyst.
AMC Entertainment Holdings Offers A Unique Way To Capitalize On The Drop In Energy Prices
- The collapse in the price of oil will have an outsized impact on the US economy creating a diverse group of winning and losing industries.
- By virtue of lower prices at the pump, additional discretionary funds will be readily available for consumers to spend as they see fit.
- The consumer discretionary sector will be the prime beneficiary of lower energy prices in 2015.
- In the article below, I will expand on my bullish thesis on AMC Entertainment Holdings Inc.
Gilead Sciences' New Contract Exclusivity Helps The Shares Advance
- The beginning of the trading year has been less than kind for the market bulls.
- Gilead Sciences bucked the down trend with a 2% advance.
- The equity outperformed coming off of the announcement of a exclusive deal with CVS Health for its revolutionary Hepatitis C franchise.
- The article will summarize my current thoughts on GILD..
Portfolio Changes For The Fourth Quarter Of 2014
- The fourth quarter saw an increase in volatility which caught many off guard.
- With an increase in volatility, some outstanding values emerged.
- The article below will detail the changes I have made in my portfolio.
Making The Difficult Decision To Part Ways With BP
- Geopolitical events have wreaked havoc on the energy market.
- BP is especially vulnerable due to their 19.75% stake in Rosneft.
- I have made the decision to limit losses and redeploy capital elsewhere.
Eastman Chemical Is An Attractive Play On The Rebound In Worldwide Economic Growth
- The chemical industry is an excellent way to play the bounce in economic growth.
- I am impressed with Eastman Chemical's management team as they have transformed the business.
- The shares are trading at a 20% discount to fair value as will be detailed below.
Verizon Currently On The Clearance Rack, Time To Buy
- Verizon is currently on sale as a price war has broken out in the telecom space.
- The sell-off in telecom shares offers a patient long-term investor an appealing entry point.
- As detailed below, I expect Verizon to return roughly 60% over the next five years.
Commentary On Gilead Sciences' Recent Plunge
- Gilead Sciences is selling off on the announcement of an exclusive deal excluding them from Express Scripts formulary.
- The stock has sold off more than twelve percent which I view as overdone.
- The article below will detail my thoughts on the recent sell-off.