Seeking Alpha
View as an RSS Feed


View Valuentum's Comments BY TICKER:
Latest comments  |  Highest rated
  • More on Hedgeye's takedown of Kinder Morgan companies [View news story]
    Doesn't Hedgeye understand that book value can be negative and a firm can still have tens of billions in market capitalization. When a firm pays out a distribution, its equity is reduced by the amount of the distribution. This is just how accounting works.

    Also, for example, please pull up Boeing's annual report (maybe from 2009)--you'll see that the aerospace giant had negative equity during most of the past last decade. Yet, its market cap is $80 billion.

    We haven't seen the Hedgeye report, but a small book value or even negative equity is nothing to be concerned about.
    Sep 4, 2013. 01:49 PM | 10 Likes Like |Link to Comment
  • Chevron's Balance Sheet Losing Luster; Losing Investment Case [View article]
    Is there anything we can help you with here? We field a lot of questions from members each and every day, and it is easier for us to do it on our own platform. We can better serve our members in that manner. We try to get to all the comments on the boards. Let us know what we could do to make you happy. I think the article and comments are not promotional at all.
    Feb 13, 2014. 02:52 AM | 6 Likes Like |Link to Comment
  • Why Price/Earnings Multiples Can Mislead Investors [View article]
    There is only one valuation metric that transcends time: cash flow. When stocks start trading in a different 'currency' besides cash per share, then the intelligent investor will adjust. Until that happens, all value is and will be measured on the basis of discounted future cash flows (adjusted for risk) and a firm's net cash/debt on the balance sheet (and other hidden asset/liabilities) -- the sum divided by diluted shares outstanding. Anyone that says otherwise is trying to sell you something. Unfortunately, this is just a fact of valuation. Please don't confuse price and value. Price is what somebody pays for something -- a firm's stock price -- while value is what investors get -- the intrinsic value of a firm.
    Nov 19, 2013. 01:12 PM | 6 Likes Like |Link to Comment
  • High DGR Dividend Growth Challengers [View article]
    Thanks David. A track record is a great sign of the board's willingness to keep raising the dividend.
    Sep 10, 2013. 12:52 PM | 6 Likes Like |Link to Comment
  • Kinder Morgan companies sink after scathing Hedgeye report [View news story]
    We haven't seen a good idea out of Hedgeye yet. Frankly, we're not sure why they get any press. Look at their call to sell all US stocks in 2010. There should be some accountability for their calls.
    Sep 4, 2013. 11:54 AM | 6 Likes Like |Link to Comment
  • Why Cisco Is Ridiculously Underpriced [View article]
    We understand that there is a lot of confusion out there about what should be preferred in a financial writer. Shortly after the dot-com bubble, there was something called the Global Settlement that encouraged an independent view on all sell-side research reports. The reason for this was that sell-side reports were biased (either to win new I-banking biz, closer relationships with management, or to prop up the stock for new trading revenue). In any case, from 2002, readers everywhere have preferred the independent view. We are an independent research provider and are free from conflict of interests.

    Thanks for the question.

    The Valuentum Team
    Apr 1, 2014. 01:04 PM | 5 Likes Like |Link to Comment
  • Why Seadrill Should Not Pay A Dividend [View article]
    Hi all,

    Thanks again for reading our piece. We know a lot of you are involved in Seadrill's shares, and we wanted to provide our unbiased perspective. Please remember that we're an independent research firm, and our analysts do not own shares of companies they write about. You don't have to worry about our writings being biased to any degree, as in the case of writers that own shares and want to prop up the stock.

    Thanks again for reading!

    The Valuentum Team
    Mar 5, 2014. 12:38 PM | 5 Likes Like |Link to Comment
  • The Coming Rebound In Commodities, Coal, And Coal Stocks [View article]
    Welcome...trouble is that US domestic consumption of thermal coal is set to fall significantly in the coming decades. Export demand may surface but it accounts for just 10% of production in the US. BHP is flooding the market with cheap met coal, which accounts for about 70% of US coal exports. The US coal miners are being squeezed by retirements/more stringent regulations in the US and tougher competition in foreign markets. The outlook is not good, and we'll likely see a few more coal producers fold in coming years, especially if China credit contraction takes hold.


    The Valuentum Team
    Jul 1, 2013. 07:56 PM | 5 Likes Like |Link to Comment
  • Why Assessing Intrinsic Value Is Important For The Dividend Investor [View article]
    Thanks Robert. We understand your need for income. And we want to point investors to the best dividend stocks. I think we're more similar than different here. We want to protect our subscribers from permanent capital loss and give the excellent income ideas as well. That's why we like to buy undervalued stocks with a high-yield kicker.

    We've really appreciated your comments, more than you know.

    The Valuentum Team
    Nov 10, 2011. 11:42 AM | 5 Likes Like |Link to Comment
  • SABMiller Makes Altria A Strong Dividend Idea [View article]
    Ernie Mac,

    That's a fantastic statement. Thanks for the comment.

    Kind regards,

    The Valuentum Team
    Oct 20, 2014. 10:11 PM | 4 Likes Like |Link to Comment
  • Evaluating GlaxoSmithKline's Dividend [View article]

    Our near-term, 5-year forecast of a firm's dividend is based on a number of factors, including the board's willingness to increase the dividend regardless of the financial risks.

    We fully expect APU's board to continue to fund dividend growth via the capital markets (equity and debt issuance) over the next 5 years, but its long-term dividend growth prospects aren't great, which is why we rate it as having very poor long-term dividend growth potential (long-term = beyond 5 years). Declining end market demand and lost customers are key fundamental concerns regarding sustainable dividend increases at APU, while the Dividend Cushion metric, which is below 1, is the most critical concern.

    The Dividend Cushion considers a firm's future free cash flow (CFO less capex) and compares this to future cash dividends, while considering the health of the balance sheet. A Dividend Cushion score above 1 is good, while a Dividend Cushion score below 1 is poor or very poor, in some cases. In the most simplest sense, this accounts for the different opinions on APU's and GSK's dividends.

    In GSK's case, the firm's Dividend Cushion is 1.3, which is greater than 1, implying both safety and growth potential without need for capital market access (unlike APU). GSK, therefore, receives a good rating with respect to dividend growth, though we forecast its future dividend growth at a similar pace as that of APU. But why?

    It comes down to the fact that boards can do whatever they want with respect to the dividend, regardless of the financial risks, and we have to acknowledge this very real fact. In APU's case, even though its dividend growth prospects are very poor, we accept that the firm's board will continue to raise it using non-organic, capital market issuance as the source (very low quality). In GSK's case, we target a similar growth rate over the 5-year forward period, but because GSK can fund dividend growth organically (high quality), its dividend growth potential is good. This is a subtle but very important difference.

    Explicit growth rates over the 5-year period = near-term

    Quality assessment of dividend growth (e.g. good) = long-term

    Thanks for reading!

    The Valuentum Team
    Jul 12, 2014. 12:50 AM | 4 Likes Like |Link to Comment
  • Why Intel's Dividend Is A Head-Turner [View article]

    Thanks for the comment. Information and biographical credentials on our principals are on the website as you mention. Here is the link:

    We attend conferences through the course of the year with the AAII and MoneyShow, and we'd be happy to meet you at one in the future.

    Thanks for reading and visiting!

    Kind regards,

    The Valuentum Team
    Jun 27, 2014. 06:50 PM | 4 Likes Like |Link to Comment
  • Why Facebook May Approach Triple Digits [View article]

    Our valuation model acknowledges the very real concept that the possible monetization opportunities for Facebook are near-endless. For example, and we're not trying to debate whether these are feasible or not, but the company can charge users not to see ads, charge companies more with more innovative ads, leverage the business pages into a payment platform to garner transactional volume and other fees. Our valuation process considers a margin of safety within the framework, and we still believe the upside potential outweighs the downside risks at this juncture. Our time horizon, however, may be longer than yours, as Facebook should be expected to succumb to the vicissitudes of the market under any near-term correction that may or may not be upon us.

    We make available out fully-populated, three-stage discounted cash flow model to clients and members.

    Thank you for reading.

    The Valuentum Team
    Apr 10, 2014. 12:27 PM | 4 Likes Like |Link to Comment
  • Johnson & Johnson Is A Dividend Growth Giant [View article]
    I would strongly encourage you to not only use one source in your investing framework. What we mean by dividend growth giant is that the firm is poised to significantly grow its dividend on the basis of its Valuentum Dividend Cushion score. What we mean by fairly valued is that it is trading in-line with our fair value range. We're not aware of anything fast, but there is a risk that whatever it is, it may have been hastily done. In any case, thanks for your thoughts. We like J&J because it is a solid firm and has strong dividend growth prospects. In a market where dividend growth is become more expensive to buy, we like J&J as a potential idea for dividend growth investors. We like to stick with corporate fundamentals when assessing the attractiveness of an idea.

    Kind regards,
    Jan 27, 2014. 07:24 PM | 4 Likes Like |Link to Comment
  • Based On Its Recent Earnings, Tesla's Share Price Is Ahead Of Its Underlying Fundamentals [View article]

    One of the greatest insights that we've garnered from our extensive analysis of Tesla is just how healthy the company's balance sheet is. For a start-up automaker, one would think it would be saddled with debt and need secondary after secondary to finance production. This was a very important takeaway of the article above.

    Thank you for commenting.

    The Valuentum Team
    Nov 21, 2013. 06:31 PM | 4 Likes Like |Link to Comment