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  • Applying Financial Analysis With Monster
    Thu, Oct. 30 MNST Comment!

    Summary

    • Not all financial analysis is created equal. Judgment is what matters.
    • Let's take a look at Monster's investment considerations.
    • We'll also calculate the firm's intrinsic value on the basis of future free cash flows.
  • Sleep Well At Night With Procter & Gamble's Shares
    Thu, Oct. 30 PG 6 Comments

    Summary

    • There are few stocks more resilient than Procter & Gamble's.
    • The firm's third-quarter report revealed ongoing strength, and its decision to sell Duracell is dividend positive.
    • Let's take a look at the firm's third-quarter results.
  • Why Apple Could Have Upside To $136 Per Share
    Wed, Oct. 29 AAPL 71 Comments

    Summary

    • We think Apple will easily beat holiday-quarter estimates.
    • A trip to the local Apple retail store is all that is needed to assess the continued tremendous interest in Apple products.
    • Let's examine its most recent quarterly performance and get our arms around the fair value estimate of shares.
  • Intel Still Resilient Despite 'Peer Pressure'
    Wed, Oct. 29 INTC 11 Comments

    Summary

    • We liked Intel's most recent quarterly report a lot.
    • The company is a stand-out in the chip space.
    • Let's discuss its third-quarter results and examine our valuation thesis on shares.
  • Why Twitter's Opportunity May Be Smaller Than You Think
    Wed, Oct. 29 TWTR 8 Comments

    Summary

    • Twitter's intrinsic value is based on what it will look like 10-20 years from now.
    • Quarterly results are largely irrelevant for Twitter, but it continues to speak of a company that is struggling to generating GAAP profits.
    • Twitter is one of the riskiest firms in our coverage.
    • We're sticking with our $33 fair value estimate of shares.
  • Pepsi's Fundamentals Could Be Better Than Coca-Cola's For Some Time
    Mon, Oct. 27 PEP 4 Comments

    Summary

    • We had thought Coca-Cola was the better idea, but Pepsi is executing far better as of late.
    • We still think Pepsi is trading for a pretty penny, but it likely has less downside than that of its soda rival, Coca-Cola.
    • We don't think Pepsi will split up its soda and snacks business in light of Coca-Cola's recent weak results.
    • Let's examine the firm through a robust discounted cash-flow process.
  • Why Coca-Cola's Investors Are Paying A Bit Too Much
    Sun, Oct. 26 KO 11 Comments

    Summary

    • Coca-Cola is a fantastic brand with a lovable product.
    • However, investors know this, and that's why shares have been bid up to pricey levels.
    • Management stated that it would miss its long-term EPS growth targets for both 2014 and 2015.
    • The company's growth does not justify its valuation, and dividend growth may be muted given headwinds.
  • SodaStream Left Out In The Cold?
    Tue, Oct. 21 SODA 2 Comments

    Summary

    • SodaStream is a likely take-out candidate, but thus far, no firm has been willing to take a stab at shares.
    • The firm's fundamentals have started to wane, and its most recent quarter spoke of troubles.
    • Let's examine what the firm's shares are worth in this article.
  • How To Estimate Colgate-Palmolive's Intrinsic Value
    Tue, Oct. 21 CL 3 Comments

    Summary

    • Research that ends without a cash-flow-derived intrinsic value estimate is news.
    • Only through a robust DCF process can value be estimated.
    • Let's perform this process to estimate Colgate-Palmolive's intrinsic value.
  • SABMiller Makes Altria A Strong Dividend Idea
    Mon, Oct. 20 MO 12 Comments

    Summary

    • Finally, investors are giving Altria credit for its large equity stake in SABMiller.
    • Though Altria's valuation is not as attractive as it once was, its dividend is as strong as ever.
    • We continue to like Altria as a holding in the Dividend Growth portfolio.
  • Why Clorox Is Slowly Going Private
    Fri, Oct. 17 CLX 23 Comments

    Summary

    • Clorox is a steady-eddy entity that consistently generates strong economic returns for shareholders.
    • Interestingly, the company is slowly going private, and we'll explain why.
    • We'll also examine the firm's cash-flow-derived intrinsic value and compare it to shares to evaluate its attractiveness from a valuation standpoint.
  • We've Raised Our Fair Value Estimate Of Microsoft Significantly
    Tue, Oct. 14 MSFT 2 Comments

    Summary

    • Market conditions aside, Microsoft remains one of the best bargains out there.
    • We recently raised our fair value estimate of the software giant to $58 per share.
    • Let's walk through the valuation to get a sense of the opportunity.
  • Why Procter & Gamble May Outperform
    Tue, Oct. 14 PG 5 Comments

    Summary

    • Traditionally, consumer staples tend to outperform in declining markets.
    • We'd put Procter & Gamble in this group of firms.
    • Let's examine Procter & Gamble's investment prospects in this piece.
  • Whirlpool Could Be Ripe For An Entry Point - Soon
    Tue, Oct. 14 WHR 2 Comments

    Summary

    • Very few firms ever score a 9 or a 10 on the Valuentum Buying Index.
    • Whirlpool has done so, but the broader market environment could complicate matters.
    • We think the company is worth putting on your watch list, nonetheless.
  • Adobe Simply Is A Cash Machine
    Mon, Oct. 13 ADBE 1 Comment

    Summary

    • Companies that throw off lots of free cash flow have tremendous financial flexibility.
    • We think Adobe is a cash machine.
    • Let's evaluate the company through the lens of a discounted cash-flow model.
  • Why Gilead Is A Perfect 10
    Fri, Oct. 10 GILD 16 Comments

    Summary

    • Gilead Sciences has a lot of things going for it.
    • Not only is the firm underpriced on a discounted cash flow basis and relative value basis, but the market is adding conviction to the valuation thesis via pricing strength.
    • Said differently, Gilead Sciences is a perfect 10 on the Valuentum Buying Index -- a very rare score.
  • An Exercise In Valuation: Oracle
    Wed, Oct. 8 ORCL 4 Comments

    Summary

    • An intrinsic value estimate differs from a price target.
    • An intrinsic value estimate calculates what shares are worth on the basis of a discounted free cash flow stream.
    • A price target is simply an opinion of an analyst as to where shares might trade at some point in the future, sometimes based on non-firm-specific noise.
    • Let's calculate a fair value estimate for Oracle in this article.
  • Nike Has Strong Fundamentals; Valuation Not Attractive, Though
    Wed, Oct. 8 NKE Comment!

    Summary

    • Nike's recent quarterly results were as strong as ever.
    • The company's brand continues to resonate with consumers, and innovation remains ongoing.
    • Shares, however, aren't cheap. And unfortunately, that's the most important thing.
  • A Calculation Of Philip Morris International's Fair Value
    Wed, Oct. 8 PM 7 Comments

    Summary

    • We think the present value of future free cash flows is one of the best ways of estimating intrinsic value.
    • Let's calculate Philip Morris International's future free cash flows.
    • By discounting those free cash flows back to today, we arrive at an intrinsic value estimate of the company.
    • Comparing this intrinsic value estimate to its stock price determines whether shares are overvalued or undervalued.
    • Let's estimate Philip Morris International's intrinsic value.
  • Estimating E.ON's Intrinsic Value
    Tue, Oct. 7 EONGY 2 Comments

    Summary

    • Utilities may be steady-eddy entities, but they are not without risks to the valuation.
    • We think an estimate of future free cash flows is the best way to estimate intrinsic value.
    • Let's compare E.ON's intrinsic value to its stock price to see if shares are undervalued or overvalued.
  • Estimating Kraft's Intrinsic Value
    Sun, Oct. 5 KRFT Comment!

    Summary

    • We think free cash flows are a key source of intrinsic value.
    • Let's arrive at a fair value estimate for Kraft's shares.
    • We'll also apply a margin of safety around the fair value estimate to assess whether shares are undervalued or overvalued.
  • We're Never Going To Add LinkedIn To The Portfolios
    Fri, Oct. 3 LNKD 1 Comment

    Summary

    • LinkedIn investors haven't seen a recession yet. We think its business model may be ultra-cyclical.
    • We think the true intrinsic value range for LinkedIn is incredibly large.
    • The firm's business model is not something that we'd consider adding to the newsletter portfolios. We just don't find it to be a very attractive business.
    • We can't see Warren Buffett investing in shares.
  • Estimating Baidu's Intrinsic Value
    Fri, Oct. 3 BIDU 3 Comments

    Summary

    • Estimating future free cash flows are an inescapable part of equity analysis.
    • Let's calculate Baidu's cash-flow-derived intrinsic value estimate to assess whether a price-vs.-value mismatch exists.
    • We'll also provide a margin of safety around the fair value estimate to arrive at a fair value range.
    • We'd consider the firm attractive on a discounted cash-flow basis if it trades outside the fair value range on the low end.
  • General Mills May Outperform
    Wed, Oct. 1 GIS 3 Comments

    Summary

    • The market may be headed for a correction, but we think General Mills may outperform.
    • The company simply dominates the cereal market, and we don't think people are going to stop eating cereal anytime soon.
    • The firm also has a rather large yield to entice investors. Let's have a look at its valuation in this piece.
  • Why We Think Procter & Gamble Is A Fantastic Dividend Growth Idea
    Wed, Oct. 1 PG 1 Comment

    Summary

    • We continue to like the pricing power of Procter & Gamble’s brands.
    • The company's earnings growth remains robust.
    • We think it is a fantastic dividend growth idea.
  • Why PPL Is Our Favorite Utility
    Tue, Sep. 30 PPL 9 Comments

    Summary

    • PPL and private-equity firm Riverstone will create one of the largest independent power producers.
    • Upon closing, PPL Corp's shareowners will own 65% of Talen Energy and Riverstone will own the balance.
    • PPL still expects 4% annual earnings-per-share expansion, which should continue to propel dividend growth.
  • Why We're Big Fans Of Kellogg
    Mon, Sep. 29 K Comment!

    Summary

    • Kellogg has a number of iconic brands. Pop-Tarts is a great example and has an impressive 80%+ share in the toaster pastries market thanks to strong advertising and innovation efforts.
    • The firm's acquisition of Pringles continues to perform better than expected. Pringles' potato chip business gives Kellogg a solid growth engine in emerging markets.
    • Evaluating the difference between price and value is key to any investment decision. Let's take a look at this relationship as it relates to Kellogg.
  • Keep An Eye On Union Pacific's Operating Ratio
    Mon, Sep. 29 UNP Comment!

    Summary

    • The operating ratio for a railroad is the inverse of the operating margin -- the lower the better.
    • We think Union Pacific's operating ratio will be the best among peers by the end of this decade, aided in part by renewed pricing strength.
    • The firm also boasts a strong Valuentum Dividend Cushion ratio and a decent annual yield. It continues to up its payout.
  • Why We Like Campbell Soup
    Sat, Sep. 27 CPB 7 Comments

    Summary

    • Campbell Soup doesn't score as high on our methodology, but we like the company's tried-and-true nature.
    • Business quality (an evaluation of our ValueCreation and ValueRisk ratings) ranks among the best of the firms in our coverage universe. The company has an Economic Castle.
    • We especially like its efforts to reinvigorate its North American soups business and the pace of new product launches.
    • Let's have a look at the shares.
  • Why Home Depot Is Simply Better Than Lowe's
    Fri, Sep. 26 HD Comment!

    Summary

    • Investors seemed confused about which company is better: Home Depot or Lowe's?
    • To us, the answer is clear.
    • Home Depot stands out on a variety of measures.
  • Cisco: Not The Best Idea In Big Cap Tech
    Fri, Sep. 26 CSCO 10 Comments

    Summary

    • It’s hard not to like Cisco’s strong free cash flow generation, solid cash balance and dominance in the communications networking market.
    • Cisco is making the best out of a difficult situation.
    • We continue to prefer Microsoft and Apple as better ideas, all things considered.
  • Why Google Has Upside To $800-Plus Per Share
    Thu, Sep. 25 GOOG, GOOGL 12 Comments

    Summary

    • Google is simply a powerhouse when it comes to search, and we don't think there is another firm in the world that can unseat the behemoth.
    • We're also fans of the company's valuation and think investors aren't giving it enough credit for its free cash flow profile. The firm has a very attractive Economic Castle.
    • Google is a one of our favorite fundamental ideas, and we don't see that changing anytime soon.
    • Very few firms are more attractive. We like the company quite a bit.