Campbell Soup (CPB) to Undergo Strategic Review: What About the Dividend?
Campbell Soup reported disappointing earnings on May 18, 2018. The stock tumbled 12% on the day and has lost approximately 30% over the past year. The company has struggled to adapt its portfolio to changing consumer tastes that prefer fresher, healthier offerings. Campbell Soup's CEO is stepping down, and the firm is undergoing a full strategic review of its business. In these situations, a company's dividend can come under pressure if management sees a major need to reduce leverage or invest more aggressively to improve long-term growth prospects. For income investors wondering how this event might affect Campbell Soup's desire to maintain its current dividend, the company's CFO Anthony DiSilvestro was supportive of the payout's safety: "But [...]
Brookfield Renewable Partners (BEP)
Founded in 1999, Brookfield Renewable Partners (BEP) is a renewable energy-focused limited partnership, or YieldCo, that's run by Brookfield Asset Management (BAM). The company is one of the world’s largest publicly-traded renewable power platforms with a portfolio consisting of over 16,300 megawatts of capacity and 843 generating facilities in North America, South America, Europe, and Asia. In total, Brookfield Renewable serves 24 energy markets in 14 countries. Source: Brookfield Renewable Investor Presentation The YieldCo's clean energy distribution is dominated by hydroelectric power plants (on over 80 global river systems), though it is quickly diversifying into wind, solar, and energy storage as well. Hydro: 82% of power generation Wind: 16% Solar & Storage: 2% Brookfield Renewable's operations are concentrated in North [...]
Ares Capital Corporation (ARCC)
Ares Capital Corporation (ARCC) is an externally managed business development company, or BDC. The company is a subsidiary of Ares Management LP (ARES), which provides the firm's management team. Ares Management has over 1,000 employees working around the world and manages over $100 billion in assets. Ares Capital specializes in acquisitions, recapitalizations, mezzanine debt, restructurings, rescue financing, and leveraged buyout transactions of private middle market companies across diverse industries. The firm is the largest BDC in America by both market cap and total portfolio size. At the end of March 2018, the company had over $12 billion invested in 360 companies. The fund typically invests between $10 million and $200 million in companies with EBITDA between $10 million [...]
EPR Properties (EPR)
EPR Properties (EPR) is an internally managed REIT that was formed in 1997 and specializes in entertainment and experiential commercial real estate properties. EPR Properties own about $6.2 billion in assets spread across four business segments: Entertainment (60% of rent revenue): includes investments in 147 megaplex theatre properties, seven entertainment retail centers (which include seven additional megaplex theatre properties), and 11 family entertainment centers. Recreation (27% of rent revenue): includes investments in 26 ski areas, 20 attractions, 30 golf entertainment complexes, and eight other recreation facilities. Education (10% of rent revenue): includes investments in 65 public charter schools, 65 early education centers, and 15 private schools. Other (2% of rent revenue): consists primarily of the land under ground lease, property [...]
Royal Bank of Canada (RY)
Founded in 1869, Royal Bank of Canada (RY) is Canada's largest bank by assets (about $1 trillion) and one of the 15 largest global banks by market cap. The firm is well-diversified across businesses, geographies and client segments, serving 16 million customers worldwide in Canada, the U.S., and 35 other countries. Royal Bank of Canada provides its services via a network of approximately 1,350 branches and more than 4,600 ATMs. The company operates under five business segments: Personal & Commercial Banking (48% of earnings): provides personal (72% of segment revenue) and business banking services (22%), as well as auto financing and retail investment products. These offerings are provided through the company's branch locations, ATMs, online channels, mobile app, and [...]
Oracle (ORCL)
Founded by Larry Ellison in 1977, Oracle (ORCL) is one of the world's leading IT software companies. The business serves the needs of over 400,000 companies companies, both large and small, in about 175 countries around the globe. Historically, Oracle has dominated enterprise level database software with about 40% market share. In this business, corporate IT departments license Oracle's software to allow their in-house IT departments to store, retrieve, and manipulate all sorts of data. Approximately 66% of Oracle's revenue is derived from this legacy business. Oracle also has a fast growing cloud-based data business, which accounts for 16% of sales, as well as hardware and service (maintenance) businesses which account for 10% and 8% of revenue, respectively. [...]
Illinois Tool Works (ITW)
Founded in 1912, Illinois Tool Works (ITW) is one of the world’s largest industrial component manufacturers, operating over 500 facilities around the globe (roughly half of sales are in North America). The company has grown into an extremely diversified manufacturer of specialized industrial and consumer equipment and consumables with a presence in many different end markets – automotive, construction, manufacturing, food & beverage, and more. Illinois Tool Works consists of hundreds of businesses it has acquired over the years. It runs a unique decentralized operating structure that empowers acquired businesses to maintain most of their culture and operations while taking advantage of ITW’s resources to better serve their customers’ needs. The company's 85 subsidiaries operate through seven [...]
Starwood Property Trust (STWD)
Starwood Property Trust (STWD) was founded in 2009 and is America's largest commercial mortgage REIT. The firm invests across the real estate capital structure and focuses primarily on originating, acquiring, financing, and managing commercial mortgage loans and other commercial real estate debt investments in both the U.S. and Europe. Starwood Property Trust is externally managed by Starwood Capital Group, which has over $50 billion in assets under management and more than 25 years of commercial real estate experience. The commercial mortgage REIT, or CmREIT, has three business segments: Real Estate Lending (48% of earnings): Starwood offers real estate borrowers financing in the form of first mortgages, subordinate debt, mezzanine loans, B-notes and preferred equity. The company possesses the [...]
Kroger (KR)
Kroger (KR) was founded in 1883 and is the second largest food retailer after Walmart with over $120 billion in annual sales. The company operates almost 2,800 supermarkets, of which more than 2,200 have pharmacies and nearly 1,500 have fuel centers. Kroger's grocery stores are located in 35 states and serve more than 9 million shoppers per day. The company’s stores operate under the brand names Kroger, Harris Teeter, Fred Meyer, Mariano’s, Pick ‘n Save, Metro Market, Pay Less, Smith’s, Owen’s, Baker’s, Fry’s, and others. Over 25% of Kroger's supermarket sales are generated by private label corporate brands, and approximately 44% of its private label grocery brands are manufactured at the company’s 37 food production plants. This vertical [...]
ConocoPhillips (COP)
Founded in 1917, ConocoPhillips (COP) is the world's largest independent exploration and production oil company and is nearly twice as large as its nearest rival by production. The company explores for, produces, transports, and markets crude oil, natural gas, liquefied natural gas (LNG), natural gas liquids, and bitumen in 17 countries around the world. In 2017, the company averaged nearly 1.4 million barrels per day of oil equivalent production broken down as follows: Oil: 50% of 2017 production Natural gas: 38% of 2017 production Natural gas liquids: 7% of 2017 production Bitumen (viscous mix of hydrocarbons used for road surfaces and roofing): 5% of 2017 production The firm has proven reserves of about 5 billion barrels of oil equivalent [...]