I’ve always been content with the opposite: companies that keep their heads down, cash their checks, and quietly make shareholders richer over time.

That’s why T. Rowe Price (Nasdaq: TROW) is on my radar this week. It’s the kind of business that rarely lands on the front page, but its work helps people sleep well at night.

T. Rowe Price is a global asset manager with $1.8 trillion in assets under management (AUM). About two-thirds of those assets are tied to retirement investors – one of the most durable customer bases on Earth.

The company makes money the old-fashioned way: It manages other people’s money and collects fees. It focuses heavily on long-term investing, research-driven portfolio management, and a culture that, frankly, is more buttoned-up than most of Wall Street.

That’s not exciting. But if you’re managing retirement accounts, excitement is overrated.

Stability is the point.

In the third quarter, net revenues rose 6% year over year to $1.9 billion, while diluted earnings per share hit $2.87, up 8.7% from a year ago. AUM gained $89 billion of market appreciation despite $7.9 billion in net outflows.

Management emphasized improving investment performance, particularly across fixed income and long-term equity mandates, and highlighted its new strategic collaboration with Goldman Sachs to expand model portfolios, alternatives access, and advisor-managed accounts.

There were also significant cost moves, as expense discipline remains a priority. The company reduced headcount by roughly 4% since year-end and recorded a $28.5 million restructuring charge tied to layoffs.

It also returned $442 million to shareholders last quarter through dividends and buybacks.

With all that said, let’s now run this sure and steady asset manager through The Value Meter.

T. Rowe’s EV/NAV ratio is 1.75, far below the peer average of 3.80. That means investors are paying less than half of what they typically would for every dollar of net assets.

This is a clear sign of undervaluation compared with the broader universe.

Free cash flow efficiency paints an even better picture. The firm’s FCF/NAV ratio is 2.48%, more than double the peer average of 1.13%.

The company also grew its free cash flow 45.50% of the time across the last 12 quarters – roughly in line with the peer average of 46.76%. Given the nature of the business, this isn’t a bad thing. Rather, it shows the company’s cash growth profile is solid rather than spectacular.

Still, consistency counts. And T. Rowe delivers plenty of it.

Over the past year, its stock has traded in wide swings – from highs near $118 to lows in the high $70s before rebounding to around $98 today. The chart shows a stock that’s been pushed around by sentiment far more than by fundamentals.

That usually spells opportunity.

T. Rowe Price is not a high-octane growth engine, nor does it pretend to be. It’s a resilient, cash-generating machine with a loyal client base, improving investment performance, and a growing lineup of advisory and retirement solutions.

Add in a nice 5% dividend yield, a disciplined expense strategy, and undervalued fundamentals, and you start to see why patient investors might want to take notice.

It’s no wonder the company is buying back its own stock.

The Value Meter rates T. Rowe Price as “Slightly Undervalued.”

What stock would you like me to run through The Value Meter next? Post the ticker symbol(s) in the comments section below.

The post T. Rowe Price: Quiet, Consistent, and Minting Money appeared first on Wealthy Retirement.

Two investors look at the same jagged line and see two entirely different stories – fear for one, quiet opportunity for the other. Western Union‘s (NYSE: WU) chart is one of those Rorschach tests.

The stock crested near $12 in early 2024, faded through the rest of the year, and spent most of 2025 trying to decide whether it still belongs in a faster-moving world.

Yet beneath that messy picture is a company changing in ways the market hasn’t fully caught on to. That tension – the reputation of a fading legacy player versus the reality of a business adapting more quickly than it gets credit for – is what pulled me into Western Union this week.

Western Union is still best known for its global remittance network, the financial lifeline for millions of families spread across borders. But the company is steadily reshaping itself.

Management’s “Evolve 2025” strategy leans on something simple but smart: using the company’s enormous retail footprint to funnel customers into better digital experiences while building new services that make Western Union more than a one-trick money transfer company.

It’s slow, steady modernization rather than a flashy reinvention.

The numbers from the third quarter show both the friction and the progress. Revenue landed at just over $1 billion, basically flat from last year. Adjusted revenue dipped slightly, and North America retail continues to slide as customers shift to mobile and low-fee competitors.

But that’s only half the story.

The Consumer Services segment, which includes wallets, bill pay, and travel money, exploded 49% year over year. Digital transactions climbed 12%, marking the eighth straight quarter of healthy growth. Both GAAP and adjusted operating margins improved to 20%, a sign that the company is becoming more efficient even as it invests in its shift toward digital.

Cash generation remains the anchor. Year to date, Western Union has produced more than $400 million in operating cash flow and returned over $430 million to shareholders through buybacks and dividends.

This isn’t a company gasping for air. It’s a company trimming fat and redirecting energy.

The Value Meter focuses on what a business actually produces, not the story told around it. And the cash numbers here speak loudly.

Western Union’s enterprise value-to-net asset value ratio is 4.95, a small premium to the broad universe’s 3.80. That’s not ideal, but the next metric wipes away most of the concern: Free cash flow-to-NAV sits at 13.21%, compared with the universe’s 1.13%.

That’s not just “better.” It’s in a different league. Western Union generates cash almost 12 times more efficiently than the typical company.

Its 12-quarter free cash flow consistency also edges out the universe average, showing a pattern of steady improvement rather than erratic spurts.

Meanwhile, the stock looks like it’s been sentenced to the penalty box. It’s the kind of chart you see when investors doubt a company’s long-term relevance. But doubt isn’t the same as decline, and the fundamentals don’t match the pessimism baked into the price.

Western Union isn’t morphing into a high-growth fintech, and it doesn’t need to. It just needs to keep expanding its higher-margin services and nudge more of its customer base toward digital.

If it does that – and the past year suggests it’s already doing it – the market’s expectations look too low.

The Value Meter rates Western Union as “Slightly Undervalued.”

What stock would you like me to run through The Value Meter next? Post the ticker symbol(s) in the comments section below.

The post The Market’s Missing Something Big With This Bank’s Stock appeared first on Wealthy Retirement.

Its stock, a small cap with a $1.7 billion market cap, sports a juicy 6% yield.

For banks, our measure of cash flow is net interest income – the difference between the income earned by lending money and the cost to borrow the funds that are lent out.

Northwest Bancshares has been steadily growing its net interest income for years. It generated $361 million in net interest income in 2020, $391 million in 2021, $421 million the following year, and $436 million last year. This year, the company is forecast to bring in $450 million in net interest income.

In the meantime, it paid out only $102 million in dividends last year for a payout ratio of just 23%. It is expected to maintain the same payout ratio this year.

Northwest Bancshares has paid a dividend since 2010, and it raised the payout every year from 2011 through 2021. It also paid a total of three special dividends from 2012 to 2014, including a big $1 per share payout in 2014.

Given that the company is paying out only $0.23 in dividends for every dollar of net interest income, Northwest Bancshares could easily afford to raise the dividend again.

With a very low payout ratio and a strong track record of paying dividends with no reductions, there is absolutely no reason to think a dividend cut is on the horizon. In fact, if anything, management should be considering a dividend raise.

This 6% yield is very safe.

Dividend Safety Rating: A

What stock’s dividend safety would you like me to analyze next? Leave the ticker in the comments section.

You can also take a look to see whether we’ve written about your favorite stock recently. Just click on the word “Search” at the top right part of the Wealthy Retirement homepage, type in the company name and hit “Enter.”

Also, keep in mind that Safety Net can analyze only individual stocks, not exchange-traded funds, mutual funds or closed-end funds.

The post Can Northwest Bancshares Afford Its 6% Yield? appeared first on Wealthy Retirement.

Here are just a few of the issues I see with it:

• It was supposed to be an alternative currency, but it’s rarely used for transactions except by terrorists and hackers.
• It’s supposed to be a store of value, but it is very volatile.
• The most well-known crypto, Bitcoin, was made up by some mysterious guy in Japan. That hardly seems like the basis for a currency.

On Sunday, I got together with a group of friends to celebrate one of their birthdays. One of my buddies recently started working in a crypto-related business and just got back from the Bitcoin conference in Nashville, where former President Donald Trump said he wants to make the U.S. the “crypto capital of the planet.”

I peppered my friend with questions and offered my arguments against crypto – not to bash his business and prove that I’m right, but to see where I might be wrong and try to learn something.

Another friend, who’s also a crypto bull, jumped into the discussion.

“I think of Bitcoin like I think of gold. It’s a store of value,” he said. “But it’s much easier to store, transport, and transact with than bars of gold.”

We discussed how the dollar may lose its status as the global reserve currency and acknowledged that if that occurs, we may face a real currency crisis in the United States. None of us have ever experienced a currency crisis in the U.S. We have no idea what that would look like.

“I hope my Bitcoin doesn’t go to $500,000 or $1 million, because that would mean everything else has gone to $%&!” my friend exclaimed.

Like crypto itself, my thoughts on crypto are evolving.

Is it a store of value? It can be – just as much as anything else can. That includes anything that someone is willing to trade currency, goods, or services for, like comic books, baseball cards, rare coins, stamps, art, and many other items.

If people accept that it’s a store of value, it’s a store of value. A bar of gold has little utility, but if society says it’s worth $2,000, at that moment, it’s worth $2,000. The same is true for Bitcoin.

Speaking of utility, very few individuals and businesses are making transactions with Bitcoin, but more are starting to. In fact, Trump claims that his campaign has received $25 million in crypto donations, which perhaps explains his shift on cryptocurrency. (He was against it during his presidency.)

Crypto can also be easily used for transactions across borders.

A person in the U.S. who wanted to send money to a family member in another country used to have to go to Western Union, pay a big fee, and wire the cash. Today, they can simply transfer some cryptocurrency to their relative’s digital wallet by paying less than a dollar. (Crypto is hardly the only option, though – you can easily transfer money through PayPal and other services as well.)

Given that today’s money is almost all digital anyway, I rarely have much cash on me or in my house. If I have $10,000 in the bank, it’s because my bank says so. If my bank says I don’t have $10,000, I have a problem.

So crypto really isn’t that different from a digital currency, with the exception being that it’s a lot easier to store crypto at home on a disk than it is to bury your money or gold in the backyard or stash it in the walls of your house.

I’m certainly no cheerleader for crypto, and I still find many serious faults with it. But my thoughts on the subject are evolving, and I’m looking forward to continuing to dig into it. At the very least, it will be a useful mental exercise.

Sometimes people change. I used to hate Brussels sprouts – now I can’t get enough of them.

Will the same thing happen for crypto?

We’ll see.

The post Is This Crypto Skeptic Starting to See the Light? appeared first on Wealthy Retirement.

The 240-year-old bank was actually founded by Alexander Hamilton – you know, the secretary of the Treasury who became the unlikely subject of a smash hit musical. (Who knows? Perhaps years from now, we’ll all be tapping our toes to the catchy tunes from Yellen.)

BNY Mellon is enormous, overseeing nearly $50 trillion in clients’ assets, which is equal to just under half of the global GDP.

So the company is big, it’s well established and it pays a regular dividend, which currently yields around 3%. But can investors expect to keep receiving their dividends?

The metric we use to analyze banks’ dividends is net interest income (NII). This is the money that banks make from lending. They do collect fee income as well, but net interest income is the best way to decipher whether management is on the ball when it comes to lending practices.

After a slight stumble during the pandemic, BNY Mellon’s NII has been steadily growing and is expected to surge 27% in 2024, following 24% growth last year and 34% growth the year before.

Meanwhile, the company paid out $1.26 billion in dividends in 2023 for a payout ratio of just 29%. This year, the total amount paid in dividends is expected to rise to over $1.3 billion, but with NII projected to surge, the payout ratio is forecast to drop to just 24%.

BNY Mellon’s dividend has been higher every year since 2013 – although the company hasn’t technically raised the dividend every year in that span.

Twice in the past decade, the company boosted the dividend in the middle of the year and didn’t raise it again until two years later. However, the total dividend per share continued to rise each year.

Here’s an example from 2019 to 2021 to show you what I mean.

Regardless of whether you consider the dividend to have been raised every year, the company hasn’t cut it since the global financial crisis in 2009, when the federal government forced it to do so. Prior to that, there were no cuts going back to at least 1998.

Considering that the payout ratio is extremely low, NII is booming and the company has a stellar track record of paying (and boosting) its dividend, I’m as confident in this dividend as I am that Yellen: The Musical would be a flop.

Dividend Safety Rating: A

If you have a stock whose dividend safety you’d like us to analyze, leave the ticker symbol in the comments section below.

You can also take a look to see whether we’ve written about your favorite stock recently. Just click on the word “Search” at the top right part of the Wealthy Retirement homepage, type in the company name and hit “Enter.”

Also, keep in mind that Safety Net can analyze only individual stocks, not exchange-traded funds, mutual funds or closed-end funds.

The post Can Investors Rely on BNY Mellon’s Dividend? appeared first on Wealthy Retirement.

Keith Kaplan, the CEO of TradeSmith and a longtime friend of The Oxford Club, has been working on something incredible. And I’m so excited about it that I asked Keith to give you a sneak preview in today’s Wealthy Retirement.

I hope you find it as fascinating as I did.

– Marc

U.S. stocks enjoyed one heck of a run from March 2009 to February 2020.

We’re talking about 3,999 days that delivered a 400% gain in the S&P 500.

Rising tides like that may not lift all boats – but they sure do lift most of them.

Carvana (NYSE: CVNA), which generated 64.05% short interest in late June of this year, climbed as high as 244.35% during that period.

And even Bed Bath & Beyond (Nasdaq: BBBY), which filed for bankruptcy this past spring, climbed 246.55% during parts of that bull run.

But when it comes to investing, the real trick is making money when the tide is running against you… or in what investment pros refer to as a “stock picker’s market.”

One of our newest services was designed to fill that need.

It’s called Predictive Alpha Prime, and it’s powered by our artificial intelligence (AI) and machine learning program called An-E (pronounced “Annie”).

Think of it as an AI stock picker… for a stock picker’s market.

Predictive Alpha Prime was designed to provide price forecasts for virtually any stock on the S&P 500, as well as many popular exchange-traded funds and other funds.

We want to show you how it works – and even share one of the system’s latest stock recommendations.

The power of Predictive Alpha Prime is truly remarkable. It can help you find an opportunity 21 trading days out, after which you can invest the proceeds in a new opportunity and do it all again.

It’s a way of stacking win after win after win – the epitome of success in a stock picker’s market.

Here’s an example of a real-life trade that was recommended last month:

The decline in long-term Treasury yields has clearly lifted the stock market, but it has also had a direct impact on regional banks.

Lower long-term rates are likely to boost borrowing from regional bank customers and provide additional stability to the real estate and small-business markets.

And one of the companies An-E found that fits that investable idea is Atlantic Union Bankshares (NYSE: AUB).

Atlantic Union Bank offers various banking products and services, including personal banking, commercial banking, wealth management, mortgage lending and more. The bank aims to serve its customers with a combination of traditional banking values and modern financial solutions.

With that said, strong pipelines and a thriving regional economy are expected to contribute to the increase in loans until the end of 2023.

The margin is anticipated to keep growing over the next few quarters, owing to a favorable mix in both loans and deposits.

Despite pressures in the banking industry, regional banks have held up well. Atlantic Union Bankshares beat estimates in both revenue and earnings, and it yields a decent quarterly dividend.

The board of directors of Atlantic Union Bankshares has announced a quarterly dividend of $0.32 per share of common stock, reflecting an approximate 7% rise over the company’s previous dividend.

Anticipated short-term rate cuts in the future also boost net interest margin revenues.

As you saw above, An-E issued a bold prediction for Atlantic Union Bankshares: It projected that the stock would rise from $29.78 to $32.45 in just over a month. That’s nearly a 9% gain, which would’ve almost doubled the return of the S&P 500 over that time frame.

So… how did that prediction pan out?

By December 4 (more than a week ahead of schedule), the stock had already surpassed An-E’s price projection, reaching a high of $32.67.

And it closed yesterday at $32.96, locking in a 10.7% increase since November 10.

That’s right… An-E’s bold prediction actually ended up being too conservative!

The takeaway here is clear. While the mainstream headlines and “experts” are speculating about the AI of tomorrow, here at TradeSmith, we’re using machine learning and AI to funnel money into your pocket today.

Enjoy your day,

Keith

The post Can AI Pick Stocks Better Than You? appeared first on Wealthy Retirement.

But not for the financial services firm that we’re evaluating today, which is a major beneficiary of rising rates.

Yet, despite the company seeing rising rates drive earnings higher, its share price is down this year! Because a bear market takes no prisoners…

This company provides online brokerage services for retail customers and works with registered investment advisors through its institutional services platform.

It has grown to become a very big business. In total, it now manages an astounding $6.6 trillion worth of assets.

But the company’s business model is highly sensitive to interest rates.

It makes money much like a bank. It pays customers a modest amount for cash they have on deposit. Then it earns a profit by reinvesting that cash at higher rates.

While a bank mainly reinvests that cash by lending it out as mortgages and other loans, this company simply invests it into risk-free Treasurys.

The zero interest rate policy of the Federal Reserve in recent years has been a big drag on this company’s earnings. It hasn’t been able to earn a decent profit margin reinvesting customers’ cash.

Now, this year has been a different story. The return that it can earn by holding Treasurys has gone up exponentially.

Let’s look at the U.S. five-year Treasury bond, for example, which started this year paying 1.25%.

It now offers 4.36%. As I said, an exponential increase!

The company’s financials reflect this improvement.

And that’s why its stock is undervalued.

The company under our lens today is Charles Schwab (NYSE: SCHW).

For the quarter ending on September 30, 2022, Schwab’s net interest income jumped from $2 billion last year in the third quarter to $2.9 billion this year.

That means Schwab’s annual net interest income run rate is now $11.6 billion versus the $8 billion run rate from last year – a significant 45% increase.

Consensus analyst estimates show that Schwab is expected to earn $4.8 billion next year. That is a 23% increase from the $3.9 billion that analysts are calling for this year.

With a current share price of $79 as of this writing, that means Schwab is trading at 16 times its price-to-earnings ratio.

While not jaw-droppingly cheap on the surface, it does look pretty reasonable for a company that will grow earnings by 20%-plus next year and has increased earnings per share tenfold since 2010.

The chart above depicts Schwab’s earnings per share growth. And what makes it so impressive is the fact that interest rates have been near historic lows for almost all of this time period.

That means Schwab has accomplished this despite facing an interest rate headwind the entire time.

Finally, let’s look at the big picture…

A $10,000 investment in the S&P 500 made in 1987 would now be worth $217,000 with dividends reinvested. A $10,000 investment in Warren Buffett’s Berkshire Hathaway (NYSE: BRK-A) would have done far better than that, more than doubling the S&P 500 over the same period. It would now be worth $532,000.

Nicely done, Warren!

But neither the market nor the Oracle of Omaha comes even close to what Schwab has done for investors over the same time frame.

A $10,000 investment in Schwab made in 1987 would now be worth more than $3.2 million with dividends reinvested.

Be still, my beating heart!

Can you imagine what Schwab might have done if interest rates hadn’t been declining for those four decades?

This is a great company trading at a very reasonable valuation with an interest rate tailwind now finally helping it.

The Value Meter rates Charles Schwab as “Slightly Undervalued,” and I think we are looking at a great price to pay for this outperforming business.

If you have a stock whose valuation you’d like me to grade, leave the ticker in the comments section below.

Good investing,

Jody

The post A Great Company With an Interest Rate Tailwind appeared first on Wealthy Retirement.

Each Friday, Marc publishes an urgent video digest of the week’s news and what it means for the market. And this time, he covered the far-reaching implications of the recent crash in oil prices.

Click here to watch his latest update. Then, read on below to discover why Jody believes opportunity knocks for today’s most beaten-up sectors.

– Mable Buchanan, Assistant Managing Editor

I always pay very close attention to what the top investors in the world are saying…

But I pay even closer attention to what they are doing.

You see, I’ve got this crazy idea that the best investors make the best investing decisions. Therefore, the most likely place to find great investment ideas is in the portfolios of great investors.

How do I define the “best” or “great” investors? I’m referring to the top handful of pros who have put up superior investing track records for decades.

These are the investors who have proven that they are exceptional over the long term. They aren’t lucky – they are good.

Included in my list is Oaktree Capital’s Howard Marks. He recently said something I think we should all be aware of…

“The S&P 500 Is Taking the Economic Collapse a Little Too Well…”

Last week when I wrote to you, I noted that despite the economy collapsing at a rate that we have never seen before, the S&P 500 Index is actually not even down from where it was a year ago.

Marks was just on CNBC, where he also noted the surprising strength of the S&P 500.

He is one of the most followed investors on Wall Street. His memos to investors are widely read across the financial industry.

While on CNBC last week, Marks discussed how he felt that there is a disconnect between stock market performance and the reality the world is facing amid the coronavirus outbreak.

His words…

We’re only down 15% from the all-time high of February 19, but it seems to me the world is more than 15% screwed up.

His words weren’t particularly eloquent, but I believe that they are true.

The S&P 500 has rallied more than 30% from the low set on March 23. In doing so, it has retraced more than half of its fall from the record levels it hit on February 19.

These words from Marks are a warning for investors. We need to be prepared for the fact that this bear market in the S&P 500 may not be over despite the big bounce back we have had in April.

Marks also provided some historical perspective from the two prior bear markets for us to think about:

It took seven years to get back to the 2000 highs in 2007… it took 5 1/2 years to get back to the 2007 highs in late 2012.

So is it really appropriate that, given all the bad news in the world today, we should get back to the highs in only three months? That seems inappropriately positive to me.

I agree with pretty much everything that he said – but that doesn’t mean we shouldn’t be buying stocks.

Outside the S&P 500, Market Action Has Been Very Different

Despite the economic carnage, the S&P 500 isn’t even down year on year. It is off only 15% from its all-time high reached in February.

But last week, we explored how those numbers need a closer look…

When we did, we saw how the big tech stocks – Apple (Nasdaq: AAPL), Facebook (Nasdaq: FB), Google’s parent company Alphabet (Nasdaq: GOOGL), Netflix (Nasdaq: NFLX), Amazon (Nasdaq: AMZN) and Microsoft (Nasdaq: MSFT) – that now dominate the S&P 500 are the reason the index has held up so well.

But outside the big tech names, the stock market reaction has been very different. The sell-off has been much more severe.

To show you just how severe, I pulled data for four exchange-traded funds (ETFs) that tell a very different story than the S&P 500.

These four ETFs represent…

• The American banking sector
• The energy sector
• The homebuilding sector
• Small caps.

As per usual, a picture tells a thousand words…

All four ETFs have declined by at least a third this year, with American banks and energy down more than 40%.

(Remember, these big declines are not the moves of one stock. These are ETFs that are diversified across their specific sectors.)

That means that these entire sectors have been hammered.

For example, the iShares Core S&P Small-Cap ETF (NYSE: IJR) that I included in the chart is widely diversified across 600 different stocks. Those companies represent all of America’s industries.

If this 600-stock ETF is down 30%, that means there are individual stocks within it that are down much more than that.

Outside of the S&P 500, the stock market has experienced a deeper decline. That is why I believe there are excellent buying opportunities.

Like us, Howard Marks must be looking beyond the modest decline in the S&P 500 for bargains as well.

In his recent memo to his Oaktree Capital investors, Marks said that it’s time to stop “playing defense.” He is buying today when he finds good value – and his opinion is worth listening to.

To be clear, while Marks believes there is value to be had, I’m sure he would also tell you that patience will be required before that value is realized. While I believe that the worst may be behind us, it may be a while before this bear market is done.

Good investing,

Jody

The post Where to Find the Best Bargain Stocks Today appeared first on Wealthy Retirement.