MarketBeat Podcast: How To Spot Value Stocks With Real Value

Mar 29, 2022

MarketBeat Podcast: How To Spot Value Stocks With Real Value

This week, Kate’s guest is Sean O’Hara, director at Pacer Financial, which manages a number of ETFs representing various asset classes, regions and investment themes. Sean talks specifically about the Pacer US Cash Cows 100 ETF (COWZ) , which uses free cash flow yield to identify companies with strong potential. This approach has worked out well recently, with the fund returning 43% in 2021, vs. the SP’s return of 26.44%.

Sean also discusses the characteristics of specific stocks within that portfolio.

Topics discussed include:

High free cash flow yield- what is it, how is it calculated, and why does Sean like that as a mechanism to evaluate top-performing stocks

How Sean’s company’s ETF, COWZ, identifies companies with high free cash flow yield

What has changed since Fama and French won their Nobel Prize in economics, and why investors should look at different fundamental metrics than they did a few decades ago?

Why so many companies today are valued with intangible, rather than tangible, assets.

What sectors is Sean increasing exposure to, given the current broad market environment, as well as high inflation?

How Sean’s approach resulted in a 43% return last year, with the P/E ratio never going above 13. That means the stocks he’s buying are cheap relative to their peers, on a free cash flow yield basis.

What sectors is Sean’s fund overweight right now?

What traditional dividend-paying sector does Sean’s fund typically avoid?

Which old-line materials and commodities stocks fit the fund’s screening criteria, and have been strong performers lately.

Why the war in Ukraine is boosting performance in one of Sean’s portfolio companies

Why a stock long considered a tech growth stock is now a value play, based on its multiples.

How Sean adds money-making stocks at a discount.

Why McDonald’s a few decades ago is a template for other companies’ slowing growth today.

How an old-school tech company in Sean’s portfolio is reinventing itself in the era of cloud computing.

Pacer ETFs 

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7 Electric Vehicle Stocks That Are Ready to Charge Higher

The Biden administration has announced a framework for a slimmed-down $1.5 trillion infrastructure bill. Part of that framework will be a $12,500 tax credit for electric vehicle purchases. That increases the current subsidy by $4,500. And it’s music to the ears of EV companies in the United States who are making plans to scale production.

This doesn’t mean the country is close to having an EV in every driveway. There is still the issue of a charging infrastructure. The chip shortage will be a headwind on auto production of all types for at least the next several quarters. And many EV companies are not even on the starting blocks yet.

But It does mean that momentum is building. And for investors who retreated to the sideline after the EV bubble burst in early 2021, it may be time to get back in the game.

In this special presentation, we’re looking at seven stocks that stand to benefit from these subsidies in the United States.

View the "7 Electric Vehicle Stocks That Are Ready to Charge Higher".

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