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Investment Research Since 1978

Is 2017 the End for Independent Grocers?

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A number of headwinds are slamming into independent grocers, including competition from Amazon, a proliferation of "Dollar Store"-type discount retailers, and increased cost cutting by major grocery chains. Independent stores and small regional chains are getting eaten up by acquisitions from larger names, or just going out of business. Heather Haddon and Lillian Rizzo write: Bankers who handle food-retail deals say the squeeze is creating more acquisition opportunities for big grocers, particularly as smaller family run companies face an older generation of leaders stepping back. “The … [Read more...]

Is Wal-Mart Ready to Compete with Amazon Online?

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A surge in e-commerce sales boosted Wal-Mart last quarter. After aquiring Jet.com, Bonobos.com, and beefing up Walmart.com, Wal-Mart is beginning to get some traction in online retail. Sarah Nassauer and Austen Hufford report:  The strong sales figures come at a time of stiff competition among retailers facing Amazon.com Inc. While U.S. consumer spending appears strong, according to July sales data at retailers and restaurants released Tuesday, some apparel and department-store chains are struggling with customers’ changing shopping habits. U.S. grocers, of which Wal-Mart is the largest by … [Read more...]

What Can America Win in NAFTA Negotiations?

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NAFTA renegotiations have begun between the three treaty members. Businesses with international operations are watching closely to see whether or not they will be affected, and if so positively or negatively. President Trump has been a harsh critic of NAFTA and its effects on the American economy, while leaders in Canada and Mexico are happier with the current treaty. The Wall Street Journal reports that leaders want to work through the renegotiation as quickly as possible in order to avoid it becoming an issue in elections next year. “Our first goal is to keep the deal in place,” said … [Read more...]

Despite Retailer Slaughter, Sales Strong

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Despite a year or retailers suffering or going bankrupt, consumers came out strong in July. Retail sales increased by 0.6% in the month. The takeaway is that Americans are feeling better about spending, but they're choosier about where they do it. At the Wall Street Journal, Josh Mitchell and Sarah Chaney write that internet sales drove the increase. Sales over the internet drove last month’s increase, with spending at nonstore retailers growing 1.3%, the most since December. One big factor: Amazon’s Prime Day, a popular day of discounts at the site. Other retailers also posted strong … [Read more...]

Can United Technologies Expand its Most Profitable Business?

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United Technologies, the Connecticut based conglomerate that build elevators, jet engines, and HVAC systems, is attempting to purchase Rockwell Collins. Based in Iowa, Rockwell Collins an aerospace supplier producing cutting edge technologies like the F-35's new Gen III Helmet Mounted Display System (seen in the picture nearby) that would be a great bolt-on business addition to United Technologies' aerospace segment, its most profitable business. Dana Mattioli and Joann S. Lublin report for the Wall Street Journal: Rockwell specializes in cockpit displays and communications systems for … [Read more...]

The Final Richard C. Young’s Intelligence Report

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After meeting monthly strategy report deadlines since 1978, I have decided it’s time to switch gears. The name Intelligence Report will survive, but with no contribution from Richard C. Young. Instead, I am transitioning aggressively to full-time research on behalf of private clients of our family investment management firm, Richard C. Young & Co. Ltd. In this expanded venture, I will completely shift away from common stock mutual funds. I will concentrate laser like on “Dividends Around the World” from domestic and foreign common stocks with track records of increasing dividends … [Read more...]

Can You Pick the Massive Energy Winners and Losers?

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Electric vehicles are poised to take over the roads as regulatory, innovation, and cost hurdles are surmounted. Here The Economist explains the prospects for electric vehicles. The shift from fuel and pistons to batteries and electric motors is unlikely to take that long. The first death rattles of the internal combustion engine are already reverberating around the world Roughly 85% of American workers commute by car. There are now about 1bn cars on the road, almost all powered by fossil fuels. But electrification has thrown the car industry into turmoil. Its best brands are founded … [Read more...]

Crisis at Vanguard: Part I

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Originally posted August 1, 2016. Vanguard Dividend Growth Closes to New Investors  No, it is not the end of the world, but if you are a loyal Vanguard investor, as am I, having one of the few dividend-based funds in the world I advise for purchase close is a “Vanguard Crisis” for me as well as for many individual investors. How is this “Crisis at Vanguard” going to play out for the individual investor?  I have been anticipating this “Crisis at Vanguard” for a long time. And it is going to become a broadening industry crisis, not just a “Crisis at Vanguard.” The handful of big mutual … [Read more...]

These Manufacturers are Avoiding Amazon

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It turns out, being part of the largest e-commerce retail operation in America isn't something every manufacturer wants. Manufacturers looking to protect their local sellers and their brand images are trying everything to differentiate their products and to keep them off of Amazon.com. Ruth Simon reports at The Wall Street Journal that brands are using technology, exclusivity, and price controls to prevent Amazon from controlling all of their business. Some manufacturers are enforcing minimum advertised prices to make it harder for online sellers to undercut local merchants, while others give … [Read more...]