QVI Stock Picks Review | Q2 2024 | #1
Quality Value Investing's communications services sector updates for $DIS, $CMCSA, $VZ, $GOOGL, and $META.
Summary:
Quality Value Investing (QVI) reviews the performance, current wealth, and present value of its five communications services sector picks.
This report covers Walt Disney, Comcast, Verizon Communications, Alphabet, and Meta Platforms.
The QVI Concentrated and Expanded Stock Picks Real-Time Performance Trackers reflect changes in my views (buy, hold, or sell) from this sector analysis.
When referencing this report, premium (paying) subscribers can access their Quality Value Investing (QVI) Glossary of Investing Terms and Metric Targets. Unless noted, all data presented is sourced from Seeking Alpha Premium as of the market close on April 5, 2024, and intended for illustration only.
In this series, Quality Value Investing reviews the QVI Real-Time Stock Picks by sector to update each holding’s performance, current wealth, and present value.
Today’s post covers QVI’s five communications services sector picks: The Walt Disney Company (DIS), Comcast Corporation (CMCSA), Verizon Communications, Inc. (VZ), Alphabet, Inc. (GOOGL), and Meta Platforms, Inc. (META).
Company Current Wealth
To uncover each company’s current wealth, QVI defines the value proposition, measures returns on management, and assesses enterprise downside risks.
Value Proposition
QVI’s value proposition section defines the competitive advantages of each company’s products or services to its customers compared to the industry.
Economic Moat
Morningstar assigns wide economic moat ratings to Walt Disney, Comcast, Alphabet, and Meta Platforms. A narrow moat surrounds Verizon.
Value Proposition Elevator Pitches
Walt Disney is the reigning original content king in film, television, and themed resort entertainment.
Comcast is an empire that spans the entire media complex, producing content at NBC Universal, delivering programming, and providing internet services via Peacock, Sky, and Xfinity.
Verizon Communications is a counterintuitive defensive play in the burgeoning fifth-generation mobile network or 5G and the disruptive Internet of Things or IoT. Its forward dividend yield is appealing to income-focused investors.
Alphabet dominates search, data analytics, and maps with Google, mobile devices with Android, web browsing with Chrome, collaboration with Gmail and Drive, and video with YouTube, and is a rising star in the cloud and artificial intelligence.
Meta Platforms has as wide a moat as there is in social media, where its 3 billion Facebook, Instagram, Messenger, and WhatsApp users fuel a captive advertising powerhouse.
Returns on Management
QVI’s fundamentals section measures the performance strength of each company’s senior management by analyzing revenue growth, net profit margin, and returns on equity and invested capital.
Revenue Growth and Net Profit Margins
The chart below shows that Alphabet, Meta Platforms, and Walt Disney had double-digit three-year trailing revenue growth. Comcast delivered a mid-single-digit topline increase, while Verizon Communications’ growth was low-single-digits and flat.
The communications services sector had a +2.42% median revenue growth for comparison.
All communications picks, except Disney, had impressive double-digit median net profit margins in the three-year trailing period, led by Meta, Alphabet, and Verizon.
The sector had a +2.53% median net profit margin.
Next, we’ll look at each company’s returns on management and enterprise downsize risks and each stock’s present value, including shareholder yields, valuation multiples, and share price downside risks, exclusive to Quality Value Investing’s premium (paying) subscribers. The post concludes with the updated views on each covered stock.
Disclosure: I/we have beneficial long positions in the common shares of CMCSA, DIS, GOOGL, and VZ in our family portfolio. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it other than from Substack paid subscriptions. I have no business relationship with any company whose stock is mentioned in this article.
Additional Disclosure: Quality Value Investing by David J. Waldron’s primary ticker research reports are for informational purposes only. The accuracy of the data cannot be guaranteed. Narrative and analytics are impersonal, i.e., not tailored to individual needs nor intended for portfolio construction beyond his family portfolio, which is presented solely for educational purposes. David is an individual investor and author, not an investment adviser. Readers should always engage in their own research or due diligence and consider (as appropriate) consulting a fee-only certified financial planner, licensed discount broker/dealer, flat fee registered investment adviser, certified public accountant, or specialized attorney before making any investment, income tax, or estate planning decisions.