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  • Mattel: Good Company Does Not Equal Good Stock
    Mon, May. 26 HAS, MAT 8 Comments

    Summary

    • Mattel has been an underperformer thus far this year.
    • Let's examine its cash flow-derived intrinsic value estimate.
    • Mattel has a Valuentum Buying Index of 3. Let's find out what this means.
  • How Hewlett-Packard's Revenue Declines Impact Its Intrinsic Value
    Mon, May. 26 AAPL, DDD, IBM 2 Comments

    Summary

    • Hewlett-Packard has a revenue problem.
    • The company can't cut costs forever, and Wall Street will eventually sour on shares.
    • Hewlett-Packard posts a Valuentum Buying Index score of 6, reflecting our "fairly valued" DCF assessment of the firm, its neutral relative valuation versus peers, and bullish technicals.
  • What Reynolds American Should Pay For Lorillard
    Sat, May. 24 MO, PM, RAI 48 Comments

    Summary

    • The tobacco industry is looking to consolidate.
    • Let's calculate what Reynolds American should pay for Lorillard.
    • Despite all the merger talk, we still prefer Altria due to its stake in SABMiller and hefty dividend yield.
  • Will GameStop Become Radio Shack In 15 Years Or Sooner?
    Thu, May. 22 AAPL, BBY, HD 5 Comments

    Summary

    • GameStop may be the Radio Shack of the 2020s.
    • GameStop posts a Valuentum Buying Index score of 6, reflecting our "fairly valued" DCF assessment of the firm, its neutral relative valuation versus peers, and bullish technicals.
    • We prefer ideas in the Best Ideas portfolio.
  • Why Target's Risks May Be Too Great
    Thu, May. 22 TGT 9 Comments

    Summary

    • We think Target has lost some of its luster.
    • Expansion plans into Canada and the firm's credit card breach have changed the company's risk profile.
    • Though Target boasts a decent Valuentum Buying Index score of 7, we prefer firms in the Best Ideas portfolio.
  • Don't Expect Another Earnings-Per-Share Target From IBM
    Wed, May. 21 APPL, HPQ, IBM 13 Comments

    Summary

    • Big Blue has managed to lure Warren Buffett into a false sense of security with its operating earnings-per-share target of at least $20 by 2015.
    • Warren Buffett owns ~6% of the firm, and we don't think he'll be in favor of any further EPS targets.
    • IBM registers a 7 on the Valuentum Buying Index. We prefer ideas in the Best Ideas portfolio.
  • Why Tesla's Growth Will Be Supported By China's Government
    Tue, May. 20 TSLA 38 Comments

    Summary

    • It's easy to dismiss Tesla's equity value as irrational. However, we think its market cap is supported on a fundamental level.
    • Tesla posts a Valuentum Buying Index score of 3, reflecting our "fairly valued" DCF assessment of the firm, its unattractive relative valuation versus peers, and bearish technicals.
    • Though we admire the new car company's resilience, we still prefer ideas in the Best Ideas portfolio.
  • 5 Controversial Dividend Growth Stocks
    Tue, May. 20 KMB, KMP, RSG 3 Comments

    Summary

    • The benefits of dividend growth investing over the long haul have been widely-documented.
    • Cash-flow-based dividend analysis such as the Valuentum Dividend Cushion helps investors take into consideration the strength of a firm's balance sheet, which is a key source of funding.
    • Let's walk through 5 controversial dividend growth stocks. Our best dividend growth ideas are included in the Dividend Growth portfolio.
  • Why Qualcomm's Economic Castle Is Remarkable
    Mon, May. 19 AAPL, GOOG, MSFT 5 Comments

    Summary

    • Valuentum's Economic Castle rating assesses a firm's ROIC-less-WACC spread to evaluate the attractiveness of its business. Qualcomm has an economic castle.
    • The firm has a Valuentum Buying Index score of 7, reflecting our "fairly valued" DCF assessment of the firm, its attractive relative valuation versus peers, and bullish technicals.
    • Though we prefer higher-rated firms in the Best Ideas portfolio, we like Qualcomm quite a bit.
  • Could California Chrome Ignite Churchill Downs?
    Mon, May. 19 LVS, MGM, CHDN Comment!

    Summary

    • California Chrome could be the first horse in more than 30 years to win the Triple Crown. This could help reinvigorate the sport.
    • Still, Churchill Downs posts a Valuentum Buying Index score of 4, reflecting our "fairly valued" DCF assessment of the firm, its attractive relative valuation versus peers, and bearish technicals.
    • We prefer companies in the Best Ideas portfolio.
  • Why Wal-Mart Is Priced Just About Right
    Sun, May. 18 AMZN, COST, TGT 4 Comments

    Summary

    • We think Wal-Mart's cash-flow-derived intrinsic value estimate supports its equity price.
    • Still, investors should be cognizant of Wal-Mart's price-earnings-to-growth ratio, which is inferior to its peer group.
    • Though Wal-Mart's Valuentum Buying Index score is not terrible, we prefer ideas in the Best Ideas portfolio and Dividend Growth portfolio.
  • Throw Out Amazon's Multiples; Focus On Cash Flow Potential
    Fri, May. 16 EBAY, EXPE, AMZN 38 Comments

    Summary

    • Investors have a difficult time understanding why Amazon fetches such a lofty price. Let's explain why.
    • Though we show why Amazon's shares are fairly valued, the company doesn't score that well on the Valuentum Buying Index, our stock selection methodology.
    • We prefer firms with higher ratings on the Valuentum Buying Index, many of which are included in the Best Ideas portfolio.
  • Why Boeing Is The Strongest It's Ever Been
    Thu, May. 15 GD, LMT, PCP 3 Comments

    Summary

    • Boeing has come a long way since the depths of the Global Financial Crisis.
    • We like the aerospace supplier quite a bit, but its Valuentum Buying Index score isn't very attractive.
    • We tend to prefer opportunities with high Valuentum Buying Index ratings, but Boeing may be the strongest it's been in history.
  • Why Oracle Is Worth A Look
    Wed, May. 14 ORCL 3 Comments

    Summary

    • Oracle is often overlooked by investors seeking big cap tech or big cap software exposure, given Apple's and Microsoft's respective investment opportunities and dividends.
    • Though Oracle doesn't score the highest rating on the Valuentum Buying Index, its score of 7 is noteworthy and certainly better than average. Shares yield a modest 1%, however.
    • We think investors should take a look at Oracle, and at the very least, keep it on their watch list. The firm has underappreciated and significant dividend growth capacity.
  • Domino's Economic Castle Doesn't Mean Shares Aren't Overpriced
    Tue, May. 13 MCD, SBUX, YUM 2 Comments

    Summary

    • Domino's franchise business model has allowed it to carve out a nice Economic Castle.
    • But despite its strong economic returns, the market has caught on to its fantastic ability to deliver value to shareholders (ROIC less WACC).
    • The company's shares are overpriced, and we continue to prefer opportunities in the Best Ideas portfolio.
  • Evaluating United Technologies' Intrinsic Value
    Tue, May. 13 HON, MMM, UTX Comment!

    Summary

    • We think the discounted cash-flow model is most applicable to global cyclical industrials like United Technologies.
    • United Technologies posts a Valuentum Buying Index score of 7, reflecting our "fairly valued" DCF assessment of the firm, its attractive relative valuation versus peers, and bullish technicals.
    • Though we like the diversified industrial giant, we prefer firms in the Best Ideas portfolio.
  • Why We're Still Huge Fans Of Microsoft
    Mon, May. 12 ADBE, ORCL, MSFT 9 Comments

    Summary

    • Microsoft is one of our favorite ideas in our coverage universe.
    • The company has a pristine balance sheet, a strong and growing dividend, and valuation upside.
    • Microsoft is a holding in both the Best Ideas portfolio and Dividend Growth portfolio.
  • 5 Very Popular But Very Unattractive Dividend Growth Firms
    Mon, May. 12 KALU, KLAC, MO 26 Comments

    Summary

    • The benefits of dividend growth investing over the long haul have been widely-documented.
    • Cash-flow-based dividend analysis such as the Valuentum Dividend Cushion helps investors take into consideration the strength of a firm's balance sheet, which is a key source of funding.
    • Let's walk through 5 very popular dividend growth ideas that may not be as attractive as you think. Our best dividend growth ideas are included in the Dividend Growth portfolio.
  • Why Salesforce.com's Future Growth Is Already Factored In
    Sun, May. 11 ADBE, MSFT, CRM 3 Comments

    Summary

    • Salesforce.com's top line is growing nicely, but its valuation largely reflects this.
    • The firm registers a 3 on the Valuentum Buying Index. We prefer higher rated firms.
    • In the valuation context, other big-cap software giants such as Microsoft look like a steal compared to Salesforce.com.
  • Why 3D Systems Isn't Worth The Risk
    Sun, May. 11 DDD 22 Comments

    Summary

    • Investors in 3D Systems are taking on a huge amount of risk.
    • We expect Hewlett-Packard and other large entities with substantial financial resources to eventually start a value-destructive pricing war in the 3D printing industry.
    • 3D Systems registers a 5 on the Valuentum Buying Index. We prefer ideas in the Best Ideas portfolio.
  • Why Einhorn Is Right About Micron
    Fri, May. 9 EMC, NTAP, SNDK 11 Comments

    Summary

    • We think hedge fund manager David Einhorn is right about upside in Micron's shares.
    • Micron Technology posts a Valuentum Buying Index score of 9, reflecting our "undervalued" DCF assessment of the firm, its attractive relative valuation versus peers, and very bullish technicals.
    • The firm is one of the highest ranked companies in our expansive coverage universe.
  • Why Hasbro Still Has Material Upside
    Fri, May. 9 MAT, HAS 1 Comment

    Summary

    • Though physical toy demand continues to face pressure, Hasbro's performance has been resilient.
    • The company is one of our favorite dividend growth ideas, having paid dividends since 1977. It has a strong Valuentum Dividend Cushion score.
    • Hasbro registers a 6 on the Valuentum Buying Index, a solid rating.
  • Evaluating Tencent's Cash-Flow-Derived Intrinsic Value
    Thu, May. 8 BIDU, FB, GOOG 3 Comments

    Summary

    • We think an intrinsic value estimate is a vital step in any investment-decision process, regardless of the business model.
    • Tencent's future growth opportunities are tremendous, and its ValueCreation rating is solid.
    • We value shares just north of $70 each, implying modest upside.
  • Why Adobe Tops Our Business Quality Matrix
    Wed, May. 7 MSFT, ORCL, ADBE Comment!

    Summary

    • Adobe is a fantastic company that throws off gobs of free cash flow.
    • The firm continues to gain significant traction with respect to Creative Cloud subscriptions. We love this recurring, subscription-based model.
    • Though we like Adobe, we prefer companies that register a higher rating on the Valuentum Buying Index. Adobe registers a 3.
  • Why 3M Is Ridiculously Overpriced
    Tue, May. 6 DHR, HON, TYC 39 Comments

    Summary

    • There is little doubt in our team's view that 3M's shares are overpriced.
    • 3M posts a Valuentum Buying Index score of 4, reflecting our "overvalued" DCF assessment of the firm, its unattractive relative valuation versus peers, and bullish technicals.
    • We think there are better ideas in the Best Ideas portfolio and Dividend Growth portfolio.
  • Why There's Much To Like About Honeywell
    Tue, May. 6 BA, DHR, MMM Comment!

    Summary

    • We think Honeywell is fundamentally well-positioned.
    • Boeing has significant flexibility to fill delivery slots in the years ahead, and the aerospace giant's nice position will have spillover benefits to suppliers, including Honeywell.
    • Though we like Honeywell, we prefer ideas in the Best Ideas portfolio and Dividend Growth portfolio.
  • Why Papa John's Shares Aren't Cheap
    Mon, May. 5 PZZA Comment!

    Summary

    • Papa John's has a long way to go in order for its fundamentals to catch up to its market pricing. There is a valuation disconnect.
    • Papa John's posts a Valuentum Buying Index score of 4, reflecting our "overvalued" DCF assessment of the firm, its unattractive relative valuation versus peers, and bullish technicals.
    • We prefer firms that register a 9 or 10 rating on the Valuentum Buying Index.
  • Why We're Passing On Seagate
    Mon, May. 5 EMC, NTAP, SNDK 12 Comments

    Summary

    • The markets Seagate competes in are intensely competitive.
    • Seagate has cut its dividend in the past, and investors should be aware of its controversial track record.
    • We generally prefer more stable firms that operate in a better industry environment and that have Valuentum Buying Index ratings of a 9 or 10.
  • Medtronic: One Of The Best Dividend Growth Ideas
    Sat, May. 3 MDT 24 Comments

    Summary

    • We think Medtronic may be one of the best dividend growth ideas for the next two decades.
    • The company's emerging market business should be a strong source of revenue and earnings growth.
    • Medtronic's Valuentum Dividend Cushion score is north of 2, implying significant safety and expansion potential.
  • Why Union Pacific Is Our Favorite Railroad Idea
    Fri, May. 2 UNP 13 Comments

    Summary

    • We like the railroad industry thanks to its significant barriers to entry.
    • Though each railroad has many things going for it, we like Union Pacific the best.
    • We expect the company to outperform in this market. The company resides in the Best Ideas portfolio.
  • Why Panera Isn't Yet Underpriced
    Wed, Apr. 30 CMG, PNRA 7 Comments

    Summary

    • The market is clearly spooked about Panera.
    • We think taking a long-term view into its fundamentals and applying the Valuentum style is the correct way of looking at the firm.
    • Panera registers a 3 on the Valuentum Buying Index. We prefer firms that score a 9 or 10 and/or are included in the Best Ideas portfolio.
  • Why Apple Is Headed Past $700 Per Share
    Wed, Apr. 30 HPQ, IBM, AAPL 61 Comments

    Summary

    • The Valuentum Buying Index has done a great job identifying entry and exit points in Apple's stock.
    • We consider Apple one of our best ideas, as well as one of our best dividend growth ideas.
    • Our fair value for the iPhone-maker suggests the firm is headed past $700 per share.