Thomas E. Browne, Jr., CFA, Portfolio Manager, Keeley Teton Small and Mid Cap Dividend Value
Thomas E. Browne, Jr., CFA, is a Portfolio Manager at the Keeley Teton Small and Mid Cap Dividend Value strategies. Mr. Browne previously was a Portfolio Manager at Keeley Asset Management Corp.
He was also a Portfolio Manager for Oppenheimer Capital, SEB Asset Management and Palisade Capital Management.
Prior to that he was a sell-side technology services analyst and was twice recognized in The Wall Street Journal’s Best on the Street survey.
Mr. Browne received a B.B.A. from Notre Dame and an MBA from New York University.
“…We think that aerospace is an interesting area to invest in these days.
The air carriers seem to be doing better.
People want to get out and see other people either for business or personal reasons after being locked down for the last couple of years due to COVID-19. Airbus (OTCMKTS:EADSY) and Boeing (NYSE:BA) have had difficulty delivering planes over the last several years for a variety of reasons.
And so it seems like we’re getting into a shortage of airplanes. With fuel prices where they are, and newer aircraft being much more fuel efficient, this creates demand for new planes.
Air Lease (NYSE:AL) is one way we’re investing in this trend. They are one of the largest aircraft lessors in the world. They will double their fleet over the next five to seven years.
They’re well managed and the stock trades well below the value of the aircraft. We think that one offers a lot of potential as well.”
Daniel L. Kane, CFA, managing director, Artisan Partners
Daniel L. Kane, CFA, is a managing director of Artisan Partners and a portfolio manager on the U.S. Value team. In this role, he is a portfolio manager for the Artisan Value Equity, U.S. Mid-Cap Value and Value Income Strategies.
“The core Meta family of apps, their core Facebook and Instagram businesses, are healthy — engagement and revenue are growing.
There is a lot of white space for revenue to grow in the future too.
The business faces tough comps from the IDFA headwind related to Apple (NASDAQ:AAPL) changes that are making tracking tougher and putting pressure on advertising revenue.
But we think they’ll come out the other side and continue to grow again.
That core business, we think, is probably worth over $700 billion today. On the other side, there’s the metaverse bet and this is hard to handicap, but the spending is unlikely to be permanent if there isn’t a path to earning an economic return.
Our belief is that based on current expectations in the market, the spending is being capitalized as if it is permanent…
There is no historical precedent where a company has lost over $10 billion per year for a decade building a business.
There will be some resolution to this, we think, in a reasonable time frame. Meaning, we think we have a high percentage of future outcomes on our side.”
John G. Ullman, President and Founder of John G. Ullman & Associates, Inc.
John G. Ullman is President and Founder of John G. Ullman & Associates, Inc. Earlier, he was President of USGM Securities, Inc., and at Corning Inc., he worked in financial management. He received a bachelor’s degree in economics from Johns Hopkins University. He received an MBA from the University of Chicago, with a focus in financial management.
“One specific company within the Utility sector that we like and own shares of is Dominion Energy (NYSE:D).
The utility company sold off its midstream assets in 2020 for $8.7 billion, and it also cut its dividends.
It did a little restructuring.
The stock sold off at the time. Generally, investors do not like it when dividends are cut. The midstream assets were sold to Warren Buffett.
It was seen as if Warren Buffett was getting a good deal in terms of value for the assets, but we liked the long-term strategic thinking of management at the time.
We also liked the valuation of the stock price, it having sold off because of these moves. And with that, we increased our position in Dominion Energy.
One of the strategic initiatives that Dominion’s management is taking is investing heavily in the renewable energy sector.
Management plans to spend $37 billion in renewable energy growth capex, so that is capital expenditure in renewable energy projects that will be in offshore wind.
The company plans to spend heavily in the offshore wind sector right off the coast of Virginia, in addition to onshore wind and solar farms.
These initiatives are supported by tax credits, and the company is protected by semi-automatic rate increases.
Therefore, we feel that this utility company is favorable in terms of a risk/reward scenario that would take place. In addition, we think the downside is fairly limited, while the company can grow along with these initiatives.
One other reason why we see the Renewable Energy sector to be favorable is that it is being supported at the state level.
States are now mandating certain renewable energy goals to meet their climate change endeavors.
We view climate change as a long-term problem, and some of these solutions are being tackled by the utility companies themselves.
So, many renewable energy stocks are priced very, very high. We stay away from those. But we found utilities such as Dominion Energy to be a safer way to invest in the renewable energy sector, given the reasonable valuation.
The price of oil and natural gas is high right now; that is another reason to invest in renewable energy, given that it is an alternative source of energy.
But that said, the price of oil and natural gas can come down. It is very volatile, and it is really determined by geopolitical factors, in addition to overall supply/demand.
While climate change is a long-term problem, we see utility companies with their resources being a major player in tackling that problem.
So overall, we like their management’s strategic thinking, their plans, their investments, in addition to the valuation of the stock.”
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