Franklin Resources (BEN)
Founded in 1947 in New York City, Franklin Resources (BEN) is the 34th largest asset manager in the world. The firm's 9,000 employees (including about 650 investment professionals) manage over $730 billion in assets for a client base located in more than 170 nations around the globe. Franklin Resources is almost a pure play active management firm, with about two thirds of its business coming from the U.S. and a primary focus on providing equity funds (42% of assets under management): Source: Franklin Resources Investor Presentation The vast majority of its business is with retail investors, specifically through their 401Ks and IRAs. Only 26% of Franklin’s clients are institutional (pensions, insurance companies, endowments, sovereign wealth funds) or high-net worth [...]
Dover (DOV)
Founded in 1947, Dover (DOV) is an international industrial conglomerate. In 2017, the company decided to spin off its energy division (18% of 2017 revenue) into a seperate company called Apergy (APY). The spin-off became official in May 2018 and left Dover with three less volatile business segments. Engineered Systems (40% of pro-forma revenue): Dover helps drive efficiencies for customers in printing, identification, vehicle service, and waste-handling equipment. Products in this segment include automation components, printing systems, hydraulic components, electronic components, 3D printing tools, and more. Fluids (35% of pro-forma revenue): products include strategically engineered specialized pumps, tubing, fueling, vehicle wash, and dispensing systems. Dover’s components and equipment are used for fueling and vehicle wash and for transferring and dispensing [...]
American States Water Company (AWR)
Founded in 1929, American States Water (AWR) is a regional regulated water and electrical utility serving 75 communities in Northern, Coastal, and Southern California. It also serves 24,000 electrical customers in San Bernardino county. Source: AWR Investor Presentation The company has two major segments. The Golden State Water Company owns the firm's regulated water and electric assets, and American States Utility Services operates privatized water systems on 11 military bases under 50-year contracts. This includes the four largest military bases in the US: Fort Bragg, Fort Bliss, Eglin Air Force Base, and Fort Riley. Source: AWR Investor Presentation In 2017, approximately 77% of the company's revenue came from its regulated utilities operations (69% from water), with the remaining 23% coming [...]
Tootsie Roll (TR)
Founded in 1896, Tootsie Roll (TR) is the maker of famous candy brands such as: Tootsie Roll, Tootsie Pops, Child’s Play, Caramel Apple Pops, Charms, Blow-Pop, Junior Mints, Charleston Chew, Sugar Daddy, Sugar Babies, Andes, Razzles, and Dubble Bubble. The company sells its products primarily through 30 candy and grocery brokers to over 4,000 supermarkets, variety stores, dollar stores, chain grocers, and drug chains in the U.S., as well as numerous outlets in Canada and Mexico, which are its largest foreign markets. Tootsie Roll also sells in Europe, the Middle East, and Asia, but the U.S. is its largest market, accounting for 91% of total product revenue. With 52 consecutive annual dividend increases, Tootsie Roll is a dividend king. [...]
Spectra Energy Partners, LP Note (SEP)
Spectra's sponsor, Enbridge (ENB), announced a roll-up proposal in May 2018 to acquire the remaining interest in Spectra that it doesn't currently own. If accepted, SEP unitholders will receive 1.0123 common shares of Enbridge per SEP unit, representing a value of about $32 per unit today. As Enbridge laid out (see quote below), the deal was driven by U.S. tax reform and a recent regulatory change affecting how rates for certain MLPs such as Spectra will be treated in the future. Spectra Energy Partners has stated that it does not expect a material financial impact as a result of the regulatory ruling announced in March 2018, which clearly conflicts with Enbridge's statement below. SEP's board of directors is [...]
Flowers Foods (FLO)
Flowers Foods (FLO) was founded in 1919 and has grown to become the second-largest producer of packaged bakery foods in the country with over 40 operating bakeries. The company primarily sells breads, buns, rolls, tortillas, and snack cakes, and some of its key brands include Nature’s Own (the number one bread in the U.S.), Tastykake, Wonder Bread, Whitewheat, and Dave’s Killer Bread. Flowers Foods also bakes store-branded generic products. Source: Flower Foods The vast majority of the company's sales are in fresh breads and rolls, with snack foods and frozens products making up the rest of revenue. Source: Flowers Foods Approximately 85% of Flowers’ sales last year were Direct Store Delivery, in which fresh products are [...]
BCE (BCE)
Bell Canada Enterprises was founded in 1880 and changed its name to BCE (BCE) in 1983. The firm is one of Canada's big three telecom companies (the largest by customer base) and provides wireless, wireline, internet, and television services to residential, business, and wholesale customers in Canada. BCE has a total of 19.1 million customers including: 9.2 million wireless subscribers (8.5 million postpaid), 3.8 million high speed internet subscribers 2.8 million pay TV customers (1.6 million internet streaming) 3.2 million traditional landline subscribers BCE has three main business segments: Bell Wireless (35% of sales, 50% of cash flow): offers integrated digital wireless voice and data communications products and services. Bell Wireline (54% of sales, 39% of cash flow): provides data, [...]
LTC Properties (LTC)
Founded in 1992, LTC Properties (LTC) is an internally managed real estate investment trust. The firm primarily invests in senior housing and skilled nursing facilities primarily through sale-leaseback (triple net lease) transactions, mortgage financing, and structured finance solutions including mezzanine (convertible debt) lending. The REIT's portfolio includes approximately 200 properties leased to 29 operators (regional and national chains) in 29 states. LTC targets states with the largest projected growth in the population of 80-plus year old Americans over the coming years (Texas, Michigan, and Wisconsin are its largest concentrations). About 70% of the firm's properties are in America's largest cities, with 50% in the country's 31 largest metro areas. Source: LTC Properties Investor Presentation The business model is primarily [...]
Diageo (DEO)
Tracing its roots back to 1886, Diageo (DEO) is the largest producer of spirits in the world and was formed in 1997 after the merger of Guinness and Grand Metropolitan. Diageo is a British company, but the UK does not impose any foreign dividend tax withholdings on investors. Some of the firm's 200 leading global brands include Smirnoff (#1 spirit brand by volume), Captain Morgan, Guinness, Johnnie Walker (#1 spirit brand by value), and Bailey’s. Its top six "global giants" brands accounted for 43% of sales in 2017 and grew 5%. Source: Diageo Annual Report Diageo sells over 6.5 billion liters of beverages in over 180 countries and territories around the world each year. By beverage category, the company's [...]
Leggett & Platt (LEG)
Founded in 1883, Leggett & Platt (LEG) patented the first steel coil bedspring. Over the past 135 years, the company has become a diversified manufacturer that conceives, designs, and produces a wide range of engineered components (innersprings, recliner mechanisms, adjustable beds, steel wire, seat frames, carpet cushion, armrests, etc.) used in bedding, furniture, carpet, automobiles, aircraft, and other products around the world. Leggett & Platt manufactures its products in 121 facilities located in 18 countries and operates through 14 business units organized under four segments: Source: Leggett & Platt Investor Presentation The company's customers include large and well established corporations, furniture makers, home improvement stores, and original equipment manufacturers (automotive and aircraft seats). Source: Leggett & Platt Investor Presentation [...]