Freedominst http://freedominst.org/ Wed, 15 Sep 2021 21:09:39 +0000 en-US hourly 1 https://wordpress.org/?v=5.8 http://freedominst.org/wp-content/uploads/2021/03/cropped-favicon-32x32.png Freedominst http://freedominst.org/ 32 32 ORCL Stock is a cash flow machine, but the stock is ahead of itself http://freedominst.org/orcl-stock-is-a-cash-flow-machine-but-the-stock-is-ahead-of-itself/ http://freedominst.org/orcl-stock-is-a-cash-flow-machine-but-the-stock-is-ahead-of-itself/#respond Wed, 15 Sep 2021 20:58:39 +0000 http://freedominst.org/orcl-stock-is-a-cash-flow-machine-but-the-stock-is-ahead-of-itself/

The last story I wrote about Oracle (NYSE:ORCL) covered the company’s difficult, but largely successful, transition to cloud computing from the traditional on-premises software business. Results have been mixed for the ORCL stock so far. I said for the last time, “In order to adopt the new technology standard, ORCL simply added the cloud at the end of its applications and created a subscription business model with quarterly updates. Human Capital Management Cloud, Supply Chain Management Cloud, Enterprise Resource Planning Cloud, etc.

Source: Various photographs / Shutterstock.com

This is an oversimplification of Oracle’s infrastructure products and applications, but the overall financial implications are clear. ORCL’s legacy licensed software business is slowly declining and cloud applications are growing rapidly.

The only major news since then has been the release of first quarter 2022 results on September 13.

What stands out are the huge margins the company enjoys. The size may be largely due to Oracle’s acquisition history. The company has acquired more than 120 companies over the past 20 years, many small, but some large, such as Sun Microsystems in 2010 and NetSuite in 2016.

Oracle’s historic organic revenue growth is generally not that impressive, but margins nonetheless are impressive. The 2021 annual results show gross margins of around 80% and EBITDA margins ranging from 30% to 40%. Free cash flow dollars is about $ 12 billion to $ 13 billion, an incredible amount of free cash flow out of just about $ 40 billion in revenue.

Although the margins are high, the growth of the margins will be very difficult to achieve in the years to come. The company is seeing strong booking trends in its cloud offerings, which is why Oracle is increasing its investment in operating expenses and capital spending in this fiscal year. This will put pressure on margins in the near term and cause most revenue measures to stagnate or decline during the year. Oracle is currently not a growth stock.

Cloud and data business segments appear to be excellent

The usual tone of boast and bragging about Oracle’s earnings release was again displayed in the Q4 and year-end press release. Company founder and current CTO Larry Ellison said, “The two most popular databases in the world are Oracle Autonomous Database and Oracle MySQL. “

Still tackling the competition, Ellison said that “independent analysts have tested and confirmed that Oracle MySQL with HeatWave runs 10 to 100 times faster than Amazon’s version of MySQL called Aurora.”

Further, he commented, “Oracle Autonomous Database and Oracle MySQL with HeatWave technology have captured the cutting edge technology in the cloud database industry, and this bodes well for the future of the Oracle cloud. “

First quarter earnings and actual value of ORCL share

Oracle released its Q1 results on September 13 and the results were mixed. Revenue grew only 4% despite impressive cloud services such as Fusion ERP cloud revenue and NetSuite ERP cloud revenue growing 32% and 28% respectively.

On-site licenses, ORCL’s historic activity, continued to decline.

Free cash flow generation remained strong and stood at $ 4 billion in the quarter.

ORCL is selling for around 20x 2022 CY EPS, not too outrageous for today’s overvalued and crazy stock market. However, for a business with little to no growth, it looks high. High free cash flow but low growth companies often trade at a low to medium price / earnings ratio. This is generally how the calculations work in a discounted cash flow (DCF) assessment. Applying a generous 8% EBITDA growth for ORCL over the next 5 years, my DCF calculation results in a fair value between $ 73 and $ 79.

Morgan Stanley’s valuation for ORCL stocks is a bullish case of $ 90, a base case of $ 77, and a bearish case of $ 58. The average of these three value cases is $ 75, which, coincidentally, is exactly in the middle of my DCF valuation range.

Oracle will likely be a great investment in the future, but only at the right entry point, which is well below the intrinsic value ranges mentioned above and well below the current price today.

As of the publication date, Tom Kerr does not hold any position in any of the stocks mentioned in the article. The opinions expressed in this article are those of the author, subject to the publication guidelines of InvestorPlace.com.

Tom Kerr has worked in the financial services industry for over 25 years. He is currently a Senior Portfolio Manager at Rocky Peak Capital Management. Previously, he was Director of Investments and Director of Research of SGL Investment Advisors, and held several positions in other organizations related to finance. Mr. Kerr also contributed to the writing of La Rue.com, RagingBull.com and InvestorPlace.com. He’s a CFA charter holder and received a BBA in Finance from Texas Tech University.

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NFIB New Jersey Supports Pro-Small Business Candidates For Legislature http://freedominst.org/nfib-new-jersey-supports-pro-small-business-candidates-for-legislature/ http://freedominst.org/nfib-new-jersey-supports-pro-small-business-candidates-for-legislature/#respond Wed, 15 Sep 2021 20:42:00 +0000 http://freedominst.org/nfib-new-jersey-supports-pro-small-business-candidates-for-legislature/

NFIB New Jersey Supports Pro-Small Business Candidates For Legislature

TRENTON, NJ (September 15, 2021) – The National Federation of Independent Business (NFIB), the nation’s leading small business advocacy group, today released its list of approvals for the New Jersey Senate and Assembly in the November election. NFIB NJ State Director Eileen Kean announced the bipartisan slate of candidates, which was released by the NFIB New Jersey PAC, the state’s most influential and effective small business political action committee.

“With Main Street businesses damaged and still at risk from the COVID-19 pandemic, and the often glaring inequalities in how small businesses have been treated by the government compared to large corporations and online businesses, it It is extremely important that small businesses are well represented in Trenton, ”said Kean. “I am happy to extend the endorsement of the National Federation of Independent Business to these strong and small business-friendly applicants. Each has always demonstrated a commitment to mainstreet, free enterprise and small business owners and their employees. “

Approvals are based on comments from NFIB members, candidate questionnaires and the 2020-2021 NFIB / NJ voting record.

“Small business owners across New Jersey are facing regulatory, tax and hiring challenges like never before,” Kean continued. “We will aggressively support those candidates who best represent our members and fight for the continued growth and vitality of New Jersey small businesses. This election is too important for the business community to sit on the sidelines and accept the status quo and the uniform policies coming from Trenton. “

SENATE APPROVALS

Anthony Bucco – (25th arrondissement)

Jon Bramnick – (21st arrondissement)

Chris Connors – (9th arrondissement)

Kristen Corrado – (40th arrondissement)

Michael Doherty – (23rd arrondissement)

Vin Gopal – (11th District)

James Holzapfel – (10th arrondissement)

Gordon Johnson – (37th arrondissement)

Fred Madden – (4th arrondissement)

Vincent Mazzeo, Jr. – (2nd district)

Declan O’Scanlon, Jr. – (13th arrondissement)

Steven Oroho – (24th arrondissement)

Mike Pappas – (16th arrondissement)

Joseph Pennacchio – (26th arrondissement)

Paul Sarlo – (36th arrondissement)

Holly Schepisi – (39th arrondissement)

Robert Singer – (30th arrondissement)

Troy Singleton – (7th arrondissement)

Jean Stanfield – (8th arrondissement)

Michael Testa – (1st district)

ASSEMBLY NOTICE

Robert Auth – (39th arrondissement)

Daniel Benson – (14th arrondissement)

Brian Bergen – (25th arrondissement)

Jean Catalano – (10th arrondissement)

Robert Clifton – (12th arrondissement)

Ronald Dancer – (12th arrondissement)

Christopher DePhillips – (40th arrondissement)

John DiMaio – (23rd arrondissement)

Aura Dunn – (25th arrondissement)

Caren Fitzpatrick – (2nd district)

DiAnne Gove – (9th arrondissement)

Sean Kean – (30th arrondissement)

Antwan McClellan – (1st district)

Greg McGuckin – (10th arrondissement)

Raj Mukherji – (33rd arrondissement)

Nancy Muñoz – (21st arrondissement)

Eric Peterson – (23rd arrondissement)

Kevin Rooney – (40th arrondissement)

Brian Rumpf – (9th arrondissement)

Gerald Scharfenberger – (13th arrondissement)

Erik Simonsen – (1st district)

Espace Parker – (24th arrondissement)

Adam Taliaferro – (3rd district)

Edward Thomson – (30th arrondissement)

Jay Webber – (26th arrondissement)

Harold Wirths – (24th arrondissement)

###

For more than 75 years, the NFIB has championed the interests of American small business owners and independent businesses, both in Washington, DC, and in the 50 state capitals. The NFIB is non-profit, non-partisan, and member-driven. Since its founding in 1943, NFIB has focused exclusively on small businesses and independent businesses, and so on today. For more information, please visit nfib.com.

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Kosovo will not join ‘Open Balkan’ and support ‘Berlin Process’ – Exit http://freedominst.org/kosovo-will-not-join-open-balkan-and-support-berlin-process-exit/ http://freedominst.org/kosovo-will-not-join-open-balkan-and-support-berlin-process-exit/#respond Wed, 15 Sep 2021 19:23:10 +0000 http://freedominst.org/kosovo-will-not-join-open-balkan-and-support-berlin-process-exit/

Kosovo Prime Minister Albin Kurti reiterated that his government will not join “Open Balkan”, the regional cooperation initiative launched by Albania, Serbia and North Macedonia.

On Tuesday, speaking from Albania on a visit to meet German Chancellor Angela Merkel and other leaders of the Six Western Balkans (WB6), Kurti told reporters that the “Berlin process” initiated by Merkel and supported by the European Union made “Open Balkan” superfluous. .

“The Berlin process is inclusive and deep enough not to require other alternative variations,” he said.

The statement came after the Albanian prime minister accused Kosovo, at a press conference with Merkel, of relying on “conspiracy theories” to refuse to join his initiative.

Kurti urged reporters to ask Rama what he meant by “conspiracy theories,” and reiterated his government’s position that regional cooperation should take place within the framework of the Berlin process and under the surveillance of the ‘EU.

Referring to the three members of the Open Balkan, as well as the refusal of Bosnia and Herzegovina, Kosovo and Montenegro to join, Kurti said: “The Balkans are not just three states, they are not even six. The Balkans have at least 12 states, and the Western Balkans Six already have the Berlin process […] The only difference [between the BP and OB] is that the EU is not present in the latter.

Kurti argued earlier that the common regional market agreed as part of the Berlin process made the trio’s initiative redundant; that the latter has no vision of the region’s relations with the EU; and its creation has not been consulted with all WB6 countries.

He stressed that the EU’s approach in the region should focus on strengthening the rule of law in the fight against corruption; democratization, in order to weaken the autocrats; face the past, so that war criminals are not allowed to return to power; and reciprocity in relations between countries in order to guarantee human rights to minorities and avoid nationalism.

“There shouldn’t be European funds without European stocks,” he said.

Speaking about the dialogue with Serbia, Kurti said he focuses on the future status of relations between the two countries, and not on the status of Kosovo.

“We cannot compensate Serbia with our state or territory for the losses caused by the Milosevic regime two decades earlier,” he said.

Kurti criticized Serbian President Alexandar Vucic for denying the Recak massacre last month, in which Serbian troops killed 45 Kosovar Albanians in January 1999.

Hinting at Rama’s collaboration with Vucic to launch Open Balkans, Kurti said the Albanians should demand Serbia to recognize Kosovo, instead of showing understanding to Serbia for not recognizing Kosovo.

“Refusing to recognize Kosovo’s independence and refusing to recognize Serbia’s crimes are not two different things,” he said.

During talks with Merkel, Kurti said, she was not asked for Kosovo to join the initiative led by Rama and Vucic.

The Kosovo Prime Minister announced the four agreements that are expected to be signed within the framework of the Common Regional Market in Slovenia on October 6, covering the free movement of people using only identity documents and the recognition of diplomas and other qualifications.

These agreements have so far been blocked by Serbia, he said, as it refuses texts containing words such as “border, territory, state, country, government”, claiming that they refer to the State of Kosovo that Serbia refuses to recognize.

“For normal relations in the Western Balkans, it is not Kosovo that has to change, but Serbia. The pressure should not be on Kosovo but on Serbia, ”Kurti concluded.

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Explanation: The main battles ahead for the US Democrats’ $ 3.5 trillion social spending bill http://freedominst.org/explanation-the-main-battles-ahead-for-the-us-democrats-3-5-trillion-social-spending-bill/ http://freedominst.org/explanation-the-main-battles-ahead-for-the-us-democrats-3-5-trillion-social-spending-bill/#respond Wed, 15 Sep 2021 18:50:00 +0000 http://freedominst.org/explanation-the-main-battles-ahead-for-the-us-democrats-3-5-trillion-social-spending-bill/

Sept. 15 (Reuters) – Democrats are crafting a massive $ 3.5 trillion spending package that would transform the U.S. economy by investing in free community colleges, child care and green energy, funded by price hikes. taxes on wealthier and larger companies.

The drafters of the bill must balance the campaign pledges of the Biden White House and the party’s progressives and moderates, while addressing lawmakers empowered by the very slim majorities of Democrats in Congress to demand animal concessions from company.

Faced with a unified Republican opposition, Democrats will have to pass the bill along strict party lines using a legislative tool called budget reconciliation. They cannot afford to lose even one vote in the Senate and more than three votes in the House of Representatives.

Here are the main flash points:

WHAT IS THE SIZE, ANYWAY? The Biden administration spends $ 3.5 trillion in spending over 10 years, but some moderate Democrats, including Representative Stephanie Murphy of Florida, are balk at its price and how it would be financed.

US Senator Joe Manchin, a Democrat from West Virginia, and Kyrsten Sinema of Arizona, have adamantly refused to back a $ 3.5 trillion package, siding with Republicans who universally say it is too big .

Manchin won’t say what size of budget he can take, making him one of the biggest kingmakers in the negotiations. He and Sinema will discuss the package with President Joe Biden on Wednesday. Read more

HOW MUCH WILL THE RICH BUSINESSES PAY?

On Wednesday, the House Ways and Means Committee was set to present a tax plan that would raise the highest tax rates to 39.6% for individuals and 26.5% for corporations and increase taxes. capital gains taxes, reversing part of Republicans’ tax cuts in 2017.

The Biparty Joint Committee on Taxation (JCT) estimates that the tax changes would generate $ 2.07 trillion in direct revenue over 10 years, potentially leaving a funding gap of more than $ 1 trillion unless the project’s investments were made. law are reduced.

The House plan could discourage some progressives calling for more tax fairness, as it opposed Biden’s proposals to raise the corporate tax rate from one-third to 28% and tax more on the wealth transfer via inheritance from wealthy families. It also keeps alive a tax break favored by private equity managers.

The moderate Democrats in the Senate will also have a say in the tax proposals. Manchin called for an even lower 25% corporate rate.

CLIMATE OBJECTIVES AT RISK?

As Democrats consider slashing the bill, Biden’s historic investments to fight climate change could be at risk, including tax breaks for electric vehicles, solar and wind power, and other measures aimed at reaching the Biden’s goal of net zero carbon emissions by 2050.

These are estimated at $ 235 billion over 10 years – including $ 7.4 billion in credits for electric bikes and $ 27 billion for electric vehicles – making them juicy targets to reduce the bundle. During the committee debate, Republicans hammered home these credits as freebies to wealthy Tesla car buyers (TSLA.O) and companies like Amazon.com (AMZN.O).

Eliminating some green energy provisions could erode support from progressives who had pledged transformative investments to tackle climate change.

CUT SOCIAL PROGRAMS?

Progressive votes could also be threatened if the social spending proposals at the heart of Biden’s plans to strengthen the middle class and reshape the economy are removed, including universal preschool leave and paid family leave.

Democrats’ plans to extend a larger child tax credit until 2025, offering families monthly payments of up to $ 300 per child, would cost $ 556 billion, according to JCT. Tax credits for workers and child care expenses would cost $ 35 billion and an expanded earned income tax credit for low-income workers would cost $ 135 billion over a decade.

But these could also be reduced if Manchin and other moderate Democrats succeed.

Manchin expressed concern that the child tax credit does not contain any work requirement for parents or any requirement for education. Reuters analysis found that expanding credit disproportionately benefited Republican states. Read more

STATE, LOCAL IMPTS

Republicans under former President Donald Trump’s 2017 tax law capped state and local tax deductions (SALT), at $ 10,000, increasing many tax bills in top-taxed Democratic states such as than New York and California.

The restoration of the previously unlimited SALT deduction – which New York Rep. Tom Suozzi estimates would cost some $ 385 billion – has been left out of the House tax plan. But Suozzi and other Democrats, including House Ways and Means President Richard Neal of Massachusetts, said they were “working daily” to pass the inclusion of significant SALT relief in the bill.

Suozzi opposes a bill without it, saying, “No SALT, no deal.”

Reporting by Jarrett Renshaw, David Lawder and Richard Cowan, editing by Nick Zieminski

Our Standards: Thomson Reuters Trust Principles.


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Here’s Why Navin Fluorine International (NSE: NAVIFLUOR) Can Responsibly Manage Debt http://freedominst.org/heres-why-navin-fluorine-international-nse-navifluor-can-responsibly-manage-debt/ http://freedominst.org/heres-why-navin-fluorine-international-nse-navifluor-can-responsibly-manage-debt/#respond Tue, 14 Sep 2021 01:16:38 +0000 http://freedominst.org/heres-why-navin-fluorine-international-nse-navifluor-can-responsibly-manage-debt/

David Iben put it well when he said: “Volatility is not a risk that is close to our hearts. What matters to us is to avoid the permanent loss of capital. ‘ So it seems like smart money knows that debt – which is usually involved in bankruptcies – is a very important factor, when you assess the level of risk of a business. Like many other companies Navin Fluor International Limited (NSE: NAVIFLUOR) uses debt. But should shareholders be concerned about its use of debt?

When is debt a problem?

Debts and other liabilities become risky for a business when it cannot easily meet these obligations, either with free cash flow or by raising capital at an attractive price. An integral part of capitalism is the process of “creative destruction” where bankrupt companies are ruthlessly liquidated by their bankers. However, a more common (but still costly) situation is where a company has to dilute its shareholders at a cheap share price just to get its debt under control. Of course, the advantage of debt is that it often represents cheap capital, especially when it replaces dilution in a business with the ability to reinvest at high rates of return. When we think of a business’s use of debt, we first look at cash flow and debt together.

See our latest review for Navin Fluorine International

What is Navin Fluorine International’s net debt?

As you can see below, at the end of March 2021, Navin Fluorine International had a debt of 254.1 million yen, up from 230.8 million yen a year ago. Click on the image for more details. But he also has 6.13 billion yen in cash to make up for that, which means he has 5.88 billion yen in net cash.

NSEI: NAVIFLUOR History of debt to equity September 14, 2021

A look at the responsibilities of Navin Fluorine International

Zooming in on the latest balance sheet data, we can see that Navin Fluorine International had liabilities of 2.02 billion yen owed within 12 months and liabilities of 616.1 million yen beyond. On the other hand, he had cash of 6.13 billion yen and 2.91 billion yen in receivables within a year. So it actually has ₹ 6.40b Following liquid assets as total liabilities.

This surplus suggests that Navin Fluorite International has a conservative balance sheet, and could probably eliminate its debt without too much difficulty. In short, Navin Fluorine International has a net cash flow, so it’s fair to say that it doesn’t have a heavy debt load!

Also positive, Navin Fluorine International has increased its EBIT by 28% over the past year, which should make it easier to repay debt going forward. When analyzing debt levels, the balance sheet is the obvious starting point. But it is future profits, more than anything, that will determine Navin Fluorine International’s ability to maintain a healthy balance sheet in the future. So if you are focused on the future you can check this out free report showing analysts’ earnings forecasts.

Finally, while the IRS may love accounting profits, lenders only accept hard cash. Although Navin Fluorine International has net cash on its balance sheet, it is still worth examining its ability to convert earnings before interest and taxes (EBIT) into free cash flow, to help us understand how fast it is building. (or erode) that cash balance. Over the past three years, Navin Fluorine International has recorded free cash flow of 33% of its EBIT, which is lower than expected. This low cash conversion makes debt management more difficult.

In summary

While it’s always a good idea to investigate a company’s debt, in this case Navin Fluorine International has 5.88 billion yen in net cash and a decent balance sheet. And we liked the appearance of the 28% year-over-year EBIT growth from last year. So is Navin Fluorine International’s debt a risk? It does not seem to us. There is no doubt that we learn the most about debt from the balance sheet. However, not all investment risks lie on the balance sheet – far from it. For example, we have identified 2 warning signs for Navin Fluorine International that you need to be aware of.

Of course, if you are the type of investor who prefers to buy stocks without going into debt, don’t hesitate to check out our exclusive list of cash-flow-growing stocks today.

If you decide to trade Navin Fluorine International, use the cheapest platform * which is ranked # 1 overall by Barron’s, Interactive Brokers. Trade stocks, options, futures, currencies, bonds and funds in 135 markets, all from one integrated account. Promoted

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts using only unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell shares and does not take into account your goals or your financial situation. Our aim is to bring you long-term, targeted analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price sensitive companies or qualitative documents. Simply Wall St has no position in any of the stocks mentioned.
*Interactive Brokers Ranked Least Expensive Broker By StockBrokers.com Online Annual Review 2020

Do you have any feedback on this item? Are you worried about the content? Get in touch with us directly. You can also send an email to the editorial team (at) simplywallst.com.

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If you like dividends, you should like these 3 stocks http://freedominst.org/if-you-like-dividends-you-should-like-these-3-stocks/ http://freedominst.org/if-you-like-dividends-you-should-like-these-3-stocks/#respond Sat, 11 Sep 2021 15:30:00 +0000 http://freedominst.org/if-you-like-dividends-you-should-like-these-3-stocks/

Buying dividend-paying stocks can be a lucrative investment strategy. Accumulate enough of it and the passive income streams that flood your portfolio can buy you more stocks or even pay off some of your living expenses. The list of companies that will pay you to own them is extensive, and here are three stocks that could pay dividends for years to come.

1. Colgate-Palmolive

Divide by share Dividend yield Increased years in a row
$ 1.80 2.3% 58

Colgate-Palmolive (NYSE: CL) is a consumer staples company that sells a variety of household products including toothpaste, soap, pet food, cleaning products and deodorants. Its products are sold all over the world with three quarters of sales coming from overseas markets.

The products Colgate-Palmolive sells are low cost items that people use every day. They are bought – often without a second thought – when consumers are short of them. The awareness of brands such as Colgate toothpaste gives the company the opportunity to increase its prices step by step to contribute to steady revenue growth. Think about it: do you notice that the toothpaste you buy each month increases by a few cents each year? Probably not.

Image source: Getty Images

The company achieved sales of $ 17.1 billion in the past 12 months and has grown sales by an average of 2% per year over the past three years. This is modest growth, but its high profitability helps it convert 15% of its revenue to free cash flow – $ 2.6 billion in the past 12 months. This gives Colgate-Palmolive a constant flow of cash.

The company’s 50% dividend payout ratio gives management flexibility to continue increasing the dividend, which has grown an average of 3% per year over the past five years.

2. Walmart

Divide by share Dividend yield Increased years in a row
$ 2.20 1.5% 48

Walmart (NYSE: WMT) is one of the largest retailers in the world and a household name among most consumers. It operates most of its stores in the United States under the name Walmart and Sam’s Club, distributed in such a way that there is one within 10 miles of 90% of the American population.

Retailing is extremely competitive and Walmart is using its massive size to squeeze suppliers at the best possible cost in order to offer the lowest prices to consumers. The company’s operating margin is only 4% after paying its operating expenses.

Walmart had sales of $ 566 billion in the past 12 months. So despite low margins, the company made so much revenue that it still generated $ 17.8 billion in free cash flow. The gigantic retailer has also invested in expanding its e-commerce business to compete with Amazon, but he has always remained a dedicated dividend payer, recently raising it to 2%. Earlier this year, the company also announced a $ 20 billion buyback program.

Investors need to be confident that Walmart will maintain its dividend history despite these changes. Its massive size gives the company great financial flexibility.

3. The Coca-Cola Company

Divide by share Dividend yield Increased years in a row
$ 1.68 3% 59

The Coca-Cola Company (NYSE: KO) is a beverage giant famous for its eponymous brand and its position as a longtime Warren Buffett investment. Its products include a variety of sodas, bottled waters, juices, coffees and more. The company has around 20 brands that each generate $ 1 billion or more in sales each year. In fact, one in five cold non-alcoholic drinks sold worldwide comes from Coca-Cola.

Like Colgate-Palmolive and Walmart, Coca-Cola products are purchased daily and rarely receive a second thought before consumers put them in their shopping cart. Additionally, Coca-Cola’s combined brand portfolio gives it one of the best storage spaces in stores, giving the company a huge advantage that prevents most competitors from threatening to steal market share. .

Coca-Cola does not bottle its products; it sells the syrups and concentrates that the bottlers then use to make and distribute the branded drinks. This makes the business very profitable. Coca-Cola has made $ 36.4 billion in revenue in the past 12 months, generating $ 11.5 billion in free cash flow.

The company spent 81% of that free cash flow on dividends in 2020, so there isn’t much room for management to increase the payout ratio. However, the company is expected to increase its profits by 8% to 9% per year, which could give the dividend some breathing space.

Here is the bottom line

Colgate-Palmolive, Walmart, and Coca-Cola sell products that consumers use every day – and that everyday use has helped these businesses thrive for decades, regardless of the economy. Their large size, competitive advantages, and strong cash flow can fund long-standing dividends that are poised to continue for years to come. If you love dividends, it’s hard to name three best stocks to consider right now.

This article represents the opinion of the author, who may disagree with the “official” recommendation position of a premium Motley Fool consulting service. We are heterogeneous! Challenging an investment thesis – even one of our own – helps us all to think critically about investing and make decisions that help us become smarter, happier, and richer.

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A look at the intrinsic value of Keyera Corp. (TSE: KEY) http://freedominst.org/a-look-at-the-intrinsic-value-of-keyera-corp-tse-key/ http://freedominst.org/a-look-at-the-intrinsic-value-of-keyera-corp-tse-key/#respond Sat, 11 Sep 2021 15:00:04 +0000 http://freedominst.org/a-look-at-the-intrinsic-value-of-keyera-corp-tse-key/

Today we are going to review a valuation method used to estimate the attractiveness of Keyera Corp. (TSE: KEY) as an investment opportunity by estimating the company’s future cash flows and discounting them to their present value. One way to do this is to use the Discounted Cash Flow (DCF) model. Believe it or not, it’s not too hard to follow, as you will see in our example!

We draw your attention to the fact that there are many ways to assess a business and, like DCF, each technique has advantages and disadvantages in certain scenarios. If you still have burning questions about this type of valuation, take a look at the Simply Wall St.

Check out our latest analysis for Keyera

The model

We use what is called a two-step model, which simply means that we have two different periods of growth rate for the cash flow of the business. Usually the first stage is higher growth and the second stage is lower growth stage. To begin with, we need to get cash flow estimates for the next ten years. Where possible, we use analyst estimates, but when these are not available, we extrapolate the previous free cash flow (FCF) from the last estimate or stated value. We assume that companies with decreasing free cash flow will slow their rate of contraction, and companies with increasing free cash flow will see their growth rate slow during this period. We do this to reflect the fact that growth tends to slow down more in the early years than in subsequent years.

A DCF is based on the idea that a dollar in the future is worth less than a dollar today, and therefore the sum of those future cash flows is then discounted to today’s value. :

10-year Free Cash Flow (FCF) estimate

2022 2023 2024 2025 2026 2027 2028 2029 2030 2031
Leverage FCF (C $, Millions) CAN $ 430.4 million 460.1 million Canadian dollars CAN $ 598.6 million C $ 632.5 million C $ 657.9 million C $ 679.4 million CA $ 698.0 million C $ 714.6 million CA $ 729.8 million CA $ 744.0 million
Source of estimated growth rate Analyst x6 Analyst x5 Analyst x2 Analyst x2 Is 4.01% East @ 3.27% East @ 2.75% East @ 2.38% Est @ 2.13% Est @ 1.95%
Present value (CA $, Millions) discounted at 8.9% CA $ 395 CA $ 388 CA $ 464 CA $ 450 $ 430 CAD CA $ 408 CA $ 385 CA $ 362 CA $ 340 CA $ 318

(“East” = FCF growth rate estimated by Simply Wall St)
10-year present value of cash flows (PVCF) = CA $ 3.9 billion

The second stage is also known as terminal value, this is the cash flow of the business after the first stage. For a number of reasons, a very conservative growth rate is used that cannot exceed that of a country’s GDP growth. In this case, we used the 5-year average of the 10-year government bond yield (1.5%) to estimate future growth. Similar to the 10-year “growth” period, we discount future cash flows to their present value, using a cost of equity of 8.9%.

Terminal value (TV)= FCF2031 × (1 + g) ÷ (r – g) = CA $ 744M × (1 + 1.5%) ÷ (8.9% – 1.5%) = CA $ 10B

Present value of terminal value (PVTV)= TV / (1 + r)ten= CA $ 10B ÷ (1 + 8.9%)ten= CA $ 4.4 billion

Total value, or net worth, is then the sum of the present value of future cash flows, which in this case is C $ 8.3 billion. The last step is then to divide the equity value by the number of shares outstanding. From the current stock price of C $ 30.8, the company appears to be roughly at fair value with an 18% discount from the current stock price. Ratings are imprecise instruments, however, much like a telescope – move a few degrees and end up in another galaxy. Keep this in mind.

TSX: KEY Discounted Cash Flows September 11, 2021

Important assumptions

The above calculation is very dependent on two assumptions. One is the discount rate and the other is cash flow. If you don’t agree with these results, try the calculation yourself and play with the assumptions. The DCF also does not take into account the possible cyclicality of an industry or the future capital needs of a company, so it does not give a full picture of a company’s potential performance. Since we view Keyera as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which takes debt into account. In this calculation, we used 8.9%, which is based on a leveraged beta of 1.555. Beta is a measure of the volatility of a stock relative to the market as a whole. We get our average beta from the industry beta of comparable companies globally, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable company.

To move on :

While a business valuation is important, it shouldn’t be the only metric you look at when researching a business. DCF models are not the alpha and omega of investment valuation. Rather, it should be seen as a guide to “what assumptions must be true for this stock to be under / overvalued?” If a business grows at a different rate, or if its cost of equity or risk-free rate changes sharply, output can be very different. For Keyera, we’ve compiled three more factors to consider:

  1. Risks: We think you should evaluate the 5 warning signs for Keyera (1 cannot be ignored!) We reported before making an investment in the business.
  2. Management: Have insiders increased their stocks to take advantage of market sentiment about KEY’s future prospects? Check out our management and board analysis with information on CEO compensation and governance factors.
  3. Other high quality alternatives: Do you like a good all-rounder? Explore our interactive list of high-quality stocks to get a feel for what you might be missing!

PS. The Simply Wall St app performs a daily discounted cash flow valuation for each share on the TSX. If you want to find the calculation for other actions, do a search here.

If you are looking for stocks to buy, use the cheapest platform * which is ranked # 1 overall by Barron’s, Interactive Brokers. Trade stocks, options, futures, currencies, bonds and funds in 135 markets, all from one integrated account. Promoted

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts using only unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell shares and does not take into account your goals or your financial situation. Our aim is to bring you long-term, targeted analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price sensitive companies or qualitative material. Simply Wall St has no position in any of the stocks mentioned.
*Interactive Brokers Ranked Least Expensive Broker By StockBrokers.com Online Annual Review 2020

Do you have any feedback on this item? Are you worried about the content? Get in touch with us directly. You can also send an email to the editorial team (at) simplywallst.com.

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Former Rangers ace insists he has no points to prove after Ibrox exit http://freedominst.org/former-rangers-ace-insists-he-has-no-points-to-prove-after-ibrox-exit/ http://freedominst.org/former-rangers-ace-insists-he-has-no-points-to-prove-after-ibrox-exit/#respond Sat, 11 Sep 2021 09:45:00 +0000 http://freedominst.org/former-rangers-ace-insists-he-has-no-points-to-prove-after-ibrox-exit/

Former Rangers winger Barrie McKay insists his return to Scottish football with Hearts is a ‘whole new start’ and does not focus on righting the wrongs caused by his time at Ibrox.

McKay was frozen with the Rangers under Pedro Caixinha before moving to England, but struggled to really make his mark south of the border.

Photo by Ian MacNicol / Getty Images

After joining the Jambos as a free agent earlier this week, McKay is looking to get his hands on the silverware at Tynecastle rather than think about “what happened in the past.”

“It’s a whole new start for me and it’s important that I go out there and do my best. I don’t think about what’s happened in the past, ”McKay said.

“I will do my best and not think about the past.

Austria 0-1 Scotland: Steve Clarke’s men shine in Vienna to give huge boost to World Cup

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Austria 0-1 Scotland: Steve Clarke’s men shine in Vienna to give huge boost to World Cup

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Not the old business (Youtube)

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“I’m going to focus on what I’m doing now rather than what I did years and years ago.

“Everywhere you go you want to win matches and trophies. It is no different here.

This is what we want to do, this is what every player wants to do, and I hope we can do it this season.

The ex-Rangers star could make his Hearts debut this weekend in the Edinburgh derby as the capital’s sides face off in a top clash.

Although it is still early in the season, Hearts and Hibs have been in great shape; Hearts boss Robbie Neilson takes home the Premiership Manager of the Month award.

Lynne Cameron / Getty Images

McKay’s Rangers exit is now a thing of the past and it will be interesting to see how he fares in the top flight at Tynecastle after largely disappearing from the radar during his stint in English football.

In other news, ‘They need him’: Sky expert claims £ 23.5million ace Liverpool sold made ‘strange’ move

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Veterans Museum to host 9/11 commemoration – Broomfield Enterprise http://freedominst.org/veterans-museum-to-host-9-11-commemoration-broomfield-enterprise/ http://freedominst.org/veterans-museum-to-host-9-11-commemoration-broomfield-enterprise/#respond Wed, 08 Sep 2021 18:08:05 +0000 http://freedominst.org/veterans-museum-to-host-9-11-commemoration-broomfield-enterprise/

On Saturday, the Broomfield Veterans Museum will host an event commemorating the 20th anniversary of the terrorist attacks that killed nearly 3,000 people in New York City, the Pentagon and a field in Pennsylvania.

Saturday’s event will begin with a coffee and conversation at 11 a.m. by retired Army Chaplain Andy Meverden, a resident of Longmont, who will speak about the impact of September 11 on his military service and his ministry in Afghanistan. (Note, the 11 a.m. start time is one hour later than usual.)

Meverden enlisted in the military in 1972 and served 40 years as a soldier in military intelligence, psychological, medical, and armor units before being appointed chaplain in the Army Reserve. He deployed to Afghanistan in 2002-03 with the Colorado Army National Guard Green Berets. There, he created conversational English lessons for Afghan high school boys and girls. He has also led humanitarian missions with orphans and widows. He retired in 2014 after serving as the Colorado National Guard’s command chaplain.

Following Colonel Meverden’s intervention, the museum will present a documentary film “In Search of the Light of Day”, which tells the story of two families who lost loved ones in the September 11 attacks, including the Faughnan family who lives in Colorado. Through unique artwork and video, the documentary shows how each family overcame their losses and how they overcame their grief to find healing and hope.

And please see the new exhibit at the museum that honors the 18 Coloradans who died in the attacks, including Jason Dahl, the Highlands Ranch pilot whose airliner crashed in Shanksville, PA.

The Broomfield Veterans Museum is located at 12 Garden Center on the north side of Midway Boulevard, approximately 400 yards east of Wadsworth. Free entry. For more information, call 303-460-6801.

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EastEnders revenge as Jean Slater frames Ruby Allen in an exit plot? | Television and radio | Show biz & TV http://freedominst.org/eastenders-revenge-as-jean-slater-frames-ruby-allen-in-an-exit-plot-television-and-radio-show-biz-tv/ http://freedominst.org/eastenders-revenge-as-jean-slater-frames-ruby-allen-in-an-exit-plot-television-and-radio-show-biz-tv/#respond Wed, 08 Sep 2021 17:55:05 +0000 http://freedominst.org/eastenders-revenge-as-jean-slater-frames-ruby-allen-in-an-exit-plot-television-and-radio-show-biz-tv/

Jean Slater (played by Gillian Wright) hasn’t told anyone she thinks her cancer has returned except Ruby Allen (Louisa Lytton). She told him months ago, hoping Ruby would decide not to press charges against Stacey Slater (Lacey Turner). But the struggling club owner lied, telling her that she was trying her best but couldn’t help her daughter when in reality she had never tried to help him. More recently, she confessed this to EastEnders favorite Jean, and even admitted that Stacey hadn’t done anything wrong, as she had never pushed her down the stairs. Stunned, Jean left to visit her son Sean Slater (Robert Kazinsky), but before he left, she ordered Stacey to tell Martin the truth. She recently returned to Walford on the BBC soap opera, leaving Ruby on the edge of what her next move might be. But she’s been too distracted by growing cannabis in her garage and wants to get rid of it. Will Jean take revenge by setting up Ruby for drugs?

In the upcoming scenes, Jean meets Shirley Carter (Linda Henry), who tells him that she thinks she may be responsible for a fire.

The police arrive but they end up taking Jean on board for a possible drug offense.

At the police station, Jean refuses to comment on the grass found in his garage but when she gets up to leave, she ends up collapsing.

Meanwhile, Lily Slater (Lillia Turner) reveals to Martin Fowler (James Bye) that she had weed at Jean’s – and Ruby knew it.

READ MORE: Endeavor star Shaun Evans speaks on ‘We’ll See’ series ending

Ruby tries to explain to Martin what’s going on, but something is wrong with him.

He notices a text on Ruby’s police phone, thanking her for her help and informing her that a drug-related arrest has been made.

Furious at his constant betrayal of Jean, Martin decides to visit Stacey in prison.

He admits to his ex that he was wrong and explains what is going on with Ruby.

Shocked, Stacey tells Martin to sort out Ruby or she’ll kill her.

Ruby later takes a pregnancy test and cries when she checks the result – is she pregnant?

However, she doesn’t have much time to take in the news, as an angry Martin soon shows up to confront her.

Ruby is forced to tell the truth and admits that she had Stacey arrested and jailed for no reason.

If Jean decides to blame her and a stunned Martin is likely to confess to the police, the police are likely to take Jean at his word, as Ruby has proven she is a liar.

It looks like Ruby could end up serving jail time for something she didn’t do, just like Stacey.

After everything she’s done, it’s likely that Martin will turn on Ruby as well.

He might even back up Jean’s drug claims, and with schoolgirl Lily also ready to take revenge on Ruby, she might also make false claims about him to see her locked up.

Will that be enough to get Stacey out of jail sooner?

Stacey has no idea her mother’s illness, but Jean hopes Stacey will be away before it’s too late.

After sitting down on the news that her daughter is actually innocent for a few weeks, Jean was probably plotting revenge on the club owner.

Now that Stacey is back on screens, with Martin visiting, it seems possible the character is set to make a return to Walford.

Actress Lacey was also knocked out of the soap opera on maternity leave – would that be how her character returns to the plaza?

Hopefully Stacey will be home spending time with Jean before she gets worse, but will Ruby pay for her manipulative lies?

EastEnders continues Thursday at 7:30 p.m. on BBC One.

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