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The Latest from
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September 30, 2020
Occidental Petroleum Corporation (OXY:USA) currently trades at a discount to UAFRS-based (Uniform) assets, with a 0.8x Uniform P/B. At these levels, the market has expectations for profitability to remain muted, but management is excited about the Enhanced Oil Recovery (EOR) business and confident about how they are handling M&A and debt maturities...
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September 30, 2020
Highlighted Top Ideas: CVI – CVR Energy, Inc., GT – The Goodyear Tire & Rubber Company, MGM – MGM Resorts International...
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September 29, 2020
Each week, the Valens Research team highlights our most interesting insights from across our tools and our analysis, including individual company, industry, and macro insights. Top Highlight: MO – Altria Group, Inc. Other Highlights: EPAM, SNAP, SWK...
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September 29, 2020
Xylem Inc. (XYL:USA) currently trades near historical highs relative to UAFRS-based (Uniform) earnings, with a 32.3x Uniform P/E. At these levels, the market has bullish expectations for the firm, but management may have concerns about margins and OpEx, their backlog, and the coronavirus impact...
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September 28, 2020
Masco Corporation (MAS:USA) currently trades near historical averages relative to UAFRS-based (Uniform) earnings, with an 18.3x Uniform P/E. At these levels, the market has bullish expectations for the firm, while management may have concerns about sales declines, supply chain disruptions, and demand recovery...
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September 25, 2020
Stanley Black & Decker, Inc. (SWK:USA) currently trades near corporate averages relative to UAFRS-based (Uniform) earnings, with a 20.6x Uniform P/E. At these levels, the market has expectations for profitability to remain stable...
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September 24, 2020
Each week, Valens focuses on several companies that were analyzed in the prior week, where material distortions caused by as-reported GAAP accounting need to be corrected to understand a company’s economic fundamentals. Company Specific Highlights & Insights...
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September 24, 2020
- We Warned A Pullback Was Coming – Don’t Panic, Just Watch The Growth Signals. Profitability is likely to recover quickly from the recession, and key indicators point to a reason for optimism for longer-term growth. However, management sentiment indicators may be shifting more negatively around growth, which could hold down valuations in the near-term. Fundamentals should bounce back rapidly, but growing management pessimism about growth may disappoint investors in Q3
- The coronavirus pandemic has pushed the world into a short-term recession, but thanks to credit fundamentals, it’s likely not to be a protracted deep recession or long recovery. Favorable bank, corporate, and consumer credit fundamentals heading into this disruption still point to optimism for a strong recovery
- Sentiment indicators have moderated. After the recent pullback, investors are no longer ignoring risks in the near term. Valuations are expensive, though continued earnings growth would justify them. Valuations may cap near-term upside, though any drop due to valuations, growth, and sentiment signals is capped by a lack of credit overhangs...
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September 24, 2020
Altria Group, Inc. (MO:USA) currently trades below historical averages relative to UAFRS-based (Uniform) earnings, with an 11.7x Uniform P/E. At these levels, the market has bearish expectations for the firm...
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