David Fried specializes in buying stocks that are undergoing buyback and repurchasing programs; here's a look at the latest two recommendations from The Buyback Letter.
Gartner, Inc. (IT) is a global technology and consulting company that is famous for its data visualization and analysis tools, providing IT research and advisory services.
Essentially, it helps businesses navigate ongoing changes to a huge array of technologies, in areas such as finance, information technology, legal and compliance, product management, strategy and supply chain.
Its customer based includes 14,000 companies in more than 100 countries. It’s in the Business Services sector (specifically Consulting Services). The resumption of business activity has been good for its business. Based in Stamford, CT., it has a market cap of $26.4 billion.
Q3 results showed $1.16 billion in revenue (per-share operating profit of $2.06). Sales improved more than 16% year-over-year, and earnings more than doubled compared with the COVID-comparable quarter a year earlier. That beat estimates for income of $1.56 per share, and a top line of $1.14 billion.
The company appreciated some 90% through the first 3 quarters, far outperforming the sector as a whole. Gartner’s updated outlook for the full 2021 is revenue of $4.66 billion (vs. previous guidance of $4.57 billion), and full-year profit outlook of $8.54 per share (up from $7.60). In the last 12 months, management has reduced shares outstanding by 7.894%.
We last bought Loews Corp. (L) in September and sold it 2 months later for a tidy 7.51% gain. You’ll recall that Loews is most often thought of as a hotel/hospitality company, but the Loews Corp. is actually a holding company that has insurance, energy, hospitality and packaging industries.
Some of their consolidated subsidiaries include CNA Financial (property and casualty insurance), Boardwalk Pipelines (transportation and storage of natural gas and liquids), Loews Hotels & Co. and Altium Packaging (rigid plastic packaging).
Loews recently broke ground on a new $550 million Loews Arlington (Texas) Hotel and Convention Center, which will be a full-service resort and will bolster Arlington’s robust convention business. It’s the second Arlington hotel for Loews. Loews owns and/or operates 26 hotel and resorts across the U.S. and Canada.
Like many companies, Loews struggled during the early part of the pandemic, but the company has recovered some this year and has had a strong 2021 run. Q3 2021 showed net income of $220 million ($0.85 per share) compared to net income of $139 million ($0.50 per share) for Q3 2020.
Net income for the nine months ended Sept. 30, 2021 was $1.24 billion, or $4.70 per share, compared to a net loss of $1.33 billion ($4.70 per share) for the same period a year ago. Loews has rewarded shareholders with a total shareholder return of 62% in the last 12 months (that includes the dividend). In the last 12 months, management has reduced shares outstanding by 7.709%.
