Here we are again looking for a new trade to execute and while taking a look at my stock screener, it now looks like the right time to go short on Valueclick, one of the more important online advertising companies. The major problem with Valueclick is that its technology and properties have fallen behind and are no longer on the cutting edge. Some years ago, Valueclick looked like an attractive target to major players such as Google (GOOG) and Yahoo (YHOO). But I don’t see that as being as likely right now. Valueclick’s sales have been drowning. Here is a quick summary:
Ticker Name Price Dividend Yield Payout Ratio Ex-Dvd
DO Diamond Offshore Drilling Inc 33 10.62 88.69 10/30/2014
RIG Transocean Ltd 30.15 9.95 63.79 11/12/2014
WIN Windstream Holdings Inc 10.94 9.14 250.77 12/31/2014
ESV Ensco PLC 38.26 7.84 36.9 12/11/2014
NE Noble Corp plc 20.24 7.41 25.2 11/13/2014
FTR Frontier Communications Corp 6.44 6.21 362.42 12/09/2014
IRM Iron Mountain Inc 33.1 5.74 213.91 12/24/2014
HCP HCP Inc 40.1 5.44 106.92 11/06/2014
CTL CenturyLink Inc 41 5.27 #VALUE! 12/04/2014
T AT&T Inc 35.36 5.2 53.13 10/08/2014
HCN Health Care REIT Inc 62.78 5.07 3110.77 11/06/2014
TE TECO Energy Inc 17.75 4.96 96.66 11/10/2014
MAT Mattel Inc 31.775 4.78 55.2 11/24/2014
SO Southern Co/The 44.14 4.76 107.36 11/06/2014
PM Philip Morris International Inc 84.51 4.73 68.07 12/23/2014
VTR Ventas Inc 62.74 4.62 164.06 12/17/2014
PBCT People's United Financial Inc 14.46 4.56 87.67 10/29/2014
RAI Reynolds American Inc 59.44 4.51 79.1 12/10/2014
MO Altria Group Inc 46.19 4.5 81.21 12/22/2014
PCL Plum Creek Timber Co Inc 39.22 4.49 135.51 11/12/2014
PPL PPL Corp 33.48 4.45 79.79 12/09/2014
KMI Kinder Morgan Inc/DE 38.86 4.43 138.48 10/31/2014
VZ Verizon Communications Inc 49.71 4.42 51.73 10/08/2014
ED Consolidated Edison Inc 57.03 4.42 67.89 11/10/2014
SCG SCANA Corp 48.52 4.33 60.3 12/10/2014
FE FirstEnergy Corp 33.49 4.3 245.23 02/04/2015
ETR Entergy Corp 77.82 4.27 83.11 11/10/2014
DRI Darden Restaurants Inc 51.59 4.26 157.37 10/08/2014
DUK Duke Energy Corp 75.17 4.23 82.38 11/12/2014
TEG Integrys Energy Group Inc 65.62 4.15 61.84 11/28/2014
AEE Ameren Corp 38.89 4.11 75.81 12/08/2014
KIM Kimco Realty Corp 21.96 4.1 174.48 12/29/2014
PNW Pinnacle West Capital Corp 55.53 4.09 60.31 10/30/2014
LO Lorillard Inc 60.27 4.08 69.92 11/26/2014
POM Pepco Holdings Inc 26.79 4.03 245.45 12/12/2014
SPLS Staples Inc 11.955 4.02 44.26 12/24/2014
PCG PG&E Corp 45.5 4 100.61 12/30/2014
PEG Public Service Enterprise Group Inc 37.26 3.97 58.57 12/05/2014
XEL Xcel Energy Inc 30.61 3.92 58.43 12/23/2014
COP ConocoPhillips 74.77 3.91 41.66 10/09/2014
FCX Freeport-McMoRan Inc 32.32 3.87 84.82 10/10/2014
MAC Macerich Co/The 64.32 3.86 252.35 11/12/2014
COH Coach Inc 35.11 3.85 47.88 12/05/2014
CNP CenterPoint Energy Inc 24.73 3.84 114.15 11/14/2014
GAS AGL Resources Inc 51.26 3.82 70.93 11/19/2014
GRMN Garmin Ltd 50.45 3.81 57.44 12/11/2014
AEP American Electric Power Co Inc 52.87 3.78 64.46 11/10/2014
KRFT Kraft Foods Group Inc 56.3 3.73 45.05 10/13/2014
CINF Cincinnati Financial Corp 47.63 3.7 52.22 12/15/2014
CVX Chevron Corp 117.71 3.67 34.89 11/19/2014
CA CA Inc 27.46 3.64 50.39 11/18/2014
CMS CMS Energy Corp 29.99 3.6 59.69 11/05/2014
DTE DTE Energy Co 76.87 3.59 68.53 12/18/2014
MCD McDonald's Corp 94.86 3.58 55.76 11/26/2014
OKE ONEOK Inc 64.25 3.58 117.5 11/05/2014
WEC Wisconsin Energy Corp 43.81 3.56 56.96 11/12/2014
PFE Pfizer Inc 29.22 3.56 57.68 11/05/2014
EXC Exelon Corp 34.88 3.56 73.55 11/17/2014
LEG Leggett & Platt Inc 34.99 3.54 87.71 12/10/2014
PLD Prologis Inc 37.63 3.51 288.82 12/18/2014
GE General Electric Co 25.4 3.46 53.11 12/24/2014
NU Northeast Utilities 45.55 3.45 58.87 12/09/2014
F Ford Motor Co 14.59 3.43 22 10/28/2014
PAYX Paychex Inc 44.32 3.43 81.37 10/31/2014
D Dominion Resources Inc/VA 70.04 3.43 72.88 12/03/2014
CVC Cablevision Systems Corp 17.77 3.42 122.86 11/13/2014
SE Spectra Energy Corp 39.26 3.41 80.56 11/12/2014
LMT Lockheed Martin Corp 178.34 3.36 52 11/26/2014
PSA Public Storage 167.6 3.34 105.02 12/08/2014
GME GameStop Corp 40.46 3.26 37.21 11/28/2014
AVB AvalonBay Communities Inc 142.69 3.26 932.94 12/30/2014
GIS General Mills Inc 50.47 3.25 53.41 10/08/2014
AIV Apartment Investment & Management Co 32.22 3.24 31414.27 11/12/2014
K Kellogg Co 61.19 3.2 36.16 11/28/2014
EQR Equity Residential 62.61 3.19 #VALUE! 12/18/2014
WM Waste Management Inc 47.6 3.15 696.94 11/28/2014
SPG Simon Property Group Inc 165.81 3.14 111.96 11/10/2014
KMB Kimberly-Clark Corp 107.7 3.12 58.08 12/03/2014
ADI Analog Devices Inc 47.58 3.1 60.32 12/03/2014
HAS Hasbro Inc 55.42 3.1 72.88 10/30/2014
MCHP Microchip Technology Inc 46.13 3.09 71.14 11/18/2014
SYY Sysco Corp 37.7 3.08 72.31 01/07/2015
WU Western Union Co/The 16.24 3.08 34.72 12/18/2014
PBI Pitney Bowes Inc 24.38 3.08 62.64 11/12/2014
NEE NextEra Energy Inc 94.23 3.08 65.11 11/26/2014
STX Seagate Technology PLC 56.08 3.07 35.85 11/03/2014
CLX Clorox Co/The 96.47 3.07 66.16 10/27/2014
PG Procter & Gamble Co/The 83.79 3.07 61 10/15/2014
CSCO Cisco Systems Inc 25.31 3.01 47.85 01/02/2015
OXY Occidental Petroleum Corp 95.96 3 34.84 12/08/2014
CAG ConAgra Foods Inc 33.33 3 140.9 10/29/2014
LLY Eli Lilly & Co 65.67 2.98 44.89 11/14/2014
CPB Campbell Soup Co 42.45 2.94 50.88 10/08/2014
MRK Merck & Co Inc 59.9 2.94 116.53 12/11/2014
VNO Vornado Realty Trust 99.82 2.93 #VALUE! 11/05/2014
NUE Nucor Corp 51.98 2.85 96.74 12/30/2014
BMY Bristol-Myers Squibb Co 50.85 2.84 90.44 01/07/2015
WYNN Wynn Resorts Ltd 182.28 2.74 96.59 11/07/2014
MWV MeadWestvaco Corp 41.36 2.42 55.31 11/25/2014
CME CME Group Inc/IL 80.95 2.32 151.06 12/05/2014
Scary hey? Of course, because of this, Valueclick trades at a very low P/E ratio but I still consider that it is too high, especially when I compare it with the ratios of Google. Bloomberg estimates that Valueclick’s P/E ratio for next year will be 13.46 while Google’s will be 18.54. Google has been struggling to find high revenue growth (mainly because its revenues come almost exclusively from one source) but when you compare its growth to Valueclick, it looks much more attractive.
While Google has been trying various different strategies to generate new revenues, Valueclick seems content on remaining still. Of course, that is not good enough. With diminishing sales, there are few ways to make profits apart from cutting costs, and you can only do that to a certain extent. To give you an idea, just take a look at the Press Page on Valueclick’s page, there is nothing new in recent months. Compare that to Google which is launching almost one new product or initiative every week and you can understand why Valueclick is falling behind.
Here is a quick comparison of both firms financially:
Ticker Name Shares Oct 16 2014 Prices Oct 16 Values
OMC Omnicom Group Inc 32 $66.16 $2,117.12
MSFT Microsoft Corp 75 $42.74 $3,205.50
JCI Johnson Controls Inc 43 $40.69 $1,749.67
PEP PepsiCo Inc/NC 31 $90.79 $2,814.49
ETN Eaton Corp 34 $59.92 $2,037.28
DOV Dover Corp 27 $73.44 $1,982.88
ITW Illinois Tool Works Inc 37 $83.07 $3,073.59
XLNX Xilinx Inc 40 $38.49 $1,539.60
SJM JM Smucker Co/The 22 $97.88 $2,153.36
BLK BlackRock Inc 14 $310.69 $4,349.66
TROW T Rowe Price Group Inc 32 $75.43 $2,413.76
OXY Occidental Petroleum Corp 25 $86.44 $2,161
XOM Exxon Mobil Corp 22 $90.60 $1,993.20
ADI Analog Devices Inc 47 $44.60 $2,096.20
HAS Hasbro Inc 32 $54.21 $1,734.72
MAT Mattel Inc 46 $29.62 $1,362.52
AFL Aflac 32 $55.86 $1,787.52
BAX Baxter International 27 $68.18 $1,840.86
IVZ Invesco Ltd 70 $35.85 $2,509.50
CVX Chevron 21 $111.06 $2,332.26
TXN Texas Instruments Inc 33 $43.59 $1,438.47
VWO Vanguard FTSE Emerging Markets 74 $40.63 $3,006.62
BND Vanguard Total Bond Market 36 $82.97 $2,986.92
Cash $2,401.53
USDP $55,088.23
SPX 17.0219547 $3,395.03 $57,790.05
Finally, here are the stock charts for both stocks. You can see how Google has now moved above its 50 day moving average and could hopefully break out to the upside. Google’s stock has suffered greatly this year but I am counting on a rebound with hopefully good results in Q2 (to be announced in April).
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