Is AT&T a value trap or dividend income turbo charger?
I love talking about valuation and teaching its importance to investors, especially young investors.
A market crash is pending and could possibly be imminent. I am quite certain about this for reasons I will provide shortly.
The NASDAQ is falling as tech stocks begin to show cracks in their armor. Of course, according to Mr. Valuation the reason is simple – most tech stocks are overvalued.
Regarding automobile stocks, virtually every automotive manufacturer is entering the electric vehicle and autonomous driving market in some form or another.
With this video I put together 10 attractively valued dividend growth stocks offering the potential for both growing dividend income and strong capital appreciation.
Everybody is looking for IPOs and emerging growth stocks and the opportunity to invest in the next Facebook, Amazon or Netflix. Consequently, young new emerging companies have a strong market available to launch their businesses publicly.
The sell decision appears to be the most difficult decision that common stock investors must make.
After working with investors for more than 50 years, I have learned many things about human nature.
With this video I will cover the 14 regional banks that are part of the S&P 500.
For the last year or two big tech has been hot, so has new tech. For prudence sake, it might be time to take a little money off the table. No one can time the market, and the bubble has risen far further and for a lot longer than any rational person could have predicted.
One of the most common complaints I hear from investors is that their advisors or brokers like to tell them when to buy, but never tell them when to sell. Whether those criticisms are fair or not, the sell decision is certainly the most vexing decision that investors face.
It goes without saying that COVID-19 and the pandemic has been and is a terrible thing. People have gotten terribly sick and many have even succumbed to this horrible virus. Clearly, there is nothing good or positive that can be said about this scourge from a purely human or humanity perspective.
AT&T reported earnings today and although they beat expectations, the stock is trading down over 2% so far. The company was light on revenues compared to 2019 but did report free cash flow for the year of $27.5 billion, slightly below the $29 billion reported in 2019.
Although the company faces stiff competition from well-capitalized behemoths such as Microsoft and Google, the company has carved out a niche for itself.
Please accept this special edition offering on Walt Disney Company (DIS) as a lesson on valuation. Over the many years I have been a value investor, I have learned that even the best companies can become dangerously overvalued by the market.
Tesla (TSLA) makes great automobiles, and although that is not all that they do, the Tesla automobile generates most of their revenues. That may not always be the case, but it is today.
The better informed the investor is, the better the investment decisions they can make. But being an informed investor can be a very arduous task, and some would even say that conducting research on common stocks is a real snoozer.
As Mr. Valuation, I find myself constantly reminding investors that value investing requires patience. However, value investing also requires the willingness to get your money in front of attractive valuation when it is discovered. Trying to time your purchases perfectly can just as easily cause you to miss out on significant gains as it is to participate in them.
I recently did a search of the life and health insurance subsector and came up with 25 names that I considered the highest quality in the overall subsector. All of them carried investment grade credit ratings of BBB+ or better – except for one.
Many investors are attempting to justify higher stock “valuations” because interest rates are at historical lows. I would agree that lower interest rates could affect “market valuations” based on the simple law of supply and demand. The concept is simple, when fixed income offers lower returns it logically stimulates more demand for equities where higher returns can be found.
There are technical distinctions between investing versus speculating. Nevertheless, both concepts are often thought about or utilized interchangeably. Moreover, there are nuanced distinctions between a rational or well-thought-out speculation versus outright gambling.
Value often comes when good companies go out of favor, this is especially true in bull markets like we have been in the last several years. Almost by definition, when stocks are out of favor it further implies that their near-term performance may not be all that attractive.
This week I did a complete re-read of Joel Greenblatt’s classic “The Little Book That Beats The Market.” For any of you that are not familiar with the book, Joel Greenblatt presents his magic formula for picking stocks that his research indicated will beat the market most of the time.
I find it very interesting that Alexion Pharmaceuticals Inc. (ALXN) after going public in 2001, did not generate their first profit until December 2008. As we all know, this was in the throes of what is now known as the Great Recession of 2008.
After reporting better than 4th quarter results on Tuesday, the stock price of FedEx Corp. (FDX) has been on a tear. With this article, I plan to demonstrate that the fundamentals support the current price rise.
I consider Oracle an attractively valued dividend growth stock with an emphasis on growth. Oracle has a long history of generating above-average growth of earnings and cash flows, and since paying its first dividend in 2009, its dividend growth has been nothing short of extraordinary.
In this part 2, I want to share an additional perspective that my research on the growing levels of corporate debt uncovered.
The accelerated use of debt to fund the capital needs of publicly traded companies is clearly attributed to today’s unprecedented low cost of debt. Although we have all been trained and perhaps even indoctrinated into the belief that debt is bad, these are clearly unusual circumstances.
From January 31, 2020 through March 31, 2020 the market as measured by the S&P 500 fell approximately 20%. As a result, I published an article on March 26, 2020 titled “It’s A Buyers’ Market – Choose Quality If You’re Scared: 20 A-Rated, Low-Debt Blue Chips To Consider” where I implied that the market as measured by the S&P 500 had gone from being overvalued to undervalued.
In today’s uncertain investing world, I believe it is extremely important to first and foremost focus on safety and quality. Since my primary investment focus is now on dividends and dividend growth, safety to me is primarily about valuation along with dividend coverage and predictability.
This is Part 3 of this 3-part series looking at the final 10 stocks that rose in the crisis.
In part 1 of this 3 part series I provided a quick cursory look at 10 of 30 stocks that MarketWatch pointed out have done very well in spite of the coronavirus market crash. In that first group of 10, there were several names that were reasonably valued.
I have long asserted that it is a market of stocks and not a stock market. Perhaps the veracity of that statement has never been clearer than it is today. We are all aware of the devastation to the stock market in general that the shutdown instigated by the coronavirus has cost
During this horrible crisis, I feel very fortunate that “social distancing” is very practical and easy for my family and me. We are blessed to live in the country on a 20-acre estate with a private lake and a backyard that is steaming with wildlife.
When markets get as volatile as they’ve been lately, it’s extremely difficult for investors to avoid our innate “fight or flight” response. In our states of heightened emotion (fear) our logical minds try to tell us that we are witnessing an incredible buying opportunity for long-term oriented investors.
It’s stating the obvious to say that the stock markets have been in a freefall as a result of the coronavirus. However, I think it’s also important to point out that what we have recently experienced in the stock markets more resembles a flash crash than it does a correction.
The Dow Jones Industrial Average is an index of 30 stocks that is often utilized as a proxy for the whole market. Since it is such a small index, I thought you all might find it interesting to see what the market looks like considering the recent volatility.
For those investors interested in investing for an increasing dividend income stream, the Dividend Aristocrats represent the crème de la crème. Standard & Poor’s produces this premier list of blue-chip dividend growth stocks that have increased their dividends for 25 consecutive years.
For some time now I have been pointing out that the stock market as measured by the S&P 500 has become moderately overvalued. However, even more to the point, I still believe that to be true even after the price corrections we have experienced recently as a result of the coronavirus.
Pharmaceutical giant Pfizer (PFE) is a company in transition that will soon be smaller but hopefully more profitable. Since many of their established drugs are coming off patent, the company is divesting its older drug platform under the Upjohn brand and selling it to Mylan a leading generic pharmaceutical company. Pfizer believes that this will position them for more profitable growth going forward.
The bottom line to me is that Tesla is certainly a very expensive stock today. On the other hand, there is very interesting future growth expectations that could make long-term shareholders a lot of money.
Legendary investor and mentor to many investing greats Benjamin Graham once aptly stated that: “investing is most intelligent when it is most businesslike.” Personally, I agree which is why I refer to what I personally adhere to and practice with my own investing as “business perspective investing.”
Ever since I first entered the investment industry circa 1970, I have been confronted with a constant and persistent admonition about the next pending market crash. In those early days I contributed much of the negativity toward stocks to a lingering overhang from the Great Depression...
The top 3 Medical DistributorsAmerisourceBergen (ABC), Cardinal Health (CAH) and McKesson Corp. (MCK) dominate the distribution of pharmaceuticals and are estimated to represent 90% to 95% of the market. Moreover, each are dividend growth stocks, and as a specific subsector group all appear significantly undervalued.
The idea that interest rates directly affect stock prices is a commonly held belief among many investors. There are some that even go as far as to say that the only reason the stock market is up is because interest rates have been artificially kept low by the Fed.
Almost by definition, value investing rarely performs well in the short run. This is especially true when you are in a strong bull market like we’ve been in since March 2009. Most companies as represented by the S&P 500 are currently trading at fundamental multiples that are significantly above historical norms.
With this article I am going to present several ways that investors, especially retired investors, can beat the market without fail. However, what I will be presenting may not be what you are expecting, particularly if you have a narrow notion of what beating the market means.
The Key to Avoiding Obvious Mistakes Understanding how to value a business is the key to avoiding making obvious mistakes when purchasing or selling common stocks. When you know what your investment is worth, the market cannot take advantage of your gullibility.
In part 2 of this series I focused on how to value slow and moderately growing businesses. In this article, Part 3, I will shift my focus on how to value faster growing companies (growth stocks).