Morning News: July 27, 2020
Posted by Eddy Elfenbein on July 27th, 2020 at 7:07 am

Gold Rips Up Record Book as $2,000 Test Looms in Hunt for Haven

The Message Behind Gold’s Rally: The World Economy Is in Trouble

Once A Source of U.S.-China Tension, Trade Emerges as an Area of Calm

Fed Meeting Expected To Leave U.S. Bond-Stock Relationship Out Of Whack

Hedge Fund Fees in Free Fall Is the New Reality For a Humbled Industry

Virus Relief Was a ‘Bridge to Nowhere’ for Sports Apparel Maker

How Remote Work Will Create Economic Winners and Losers

Big Tech Funds a Think Tank Pushing for Fewer Rules. For Big Tech.

AstraZeneca, Daiichi Sankyo In $6 Billion Oncology Deal

Tech CEOs Deserve An Apology

Jeff Miller: Weighing the Week Ahead: Time for A Look Under the Hood of the Economic Engine

Jeff Carter: Lotsa Pie

Howard Lindzon: Momentum Monday – Big Week for Technology Company Earnings

Ben Carlson: A Roth IRA For Every Baby in America & How Much Should You Spend On An Engagement Ring?

Joshua Brown: This Is The Best Word I Could Come Up With To Describe Investors Today & Prepare for the Air Pocket

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CWS Market Review – July 24, 2020
Posted by Eddy Elfenbein on July 24th, 2020 at 7:08 am

“The stock market is a giant distraction to the business of investing.” – Jack Bogle

Before I begin, I’d like to announce I’m going to host a post-market webinar on Tuesday, July 28 at 4 pm ET. National security expert John Schindler will be joining us. The webinar is free. You can register here.

Now on to stocks. This has been a busy week for earnings reports. Seven of our Buy List stocks report earnings on Wednesday and Thursday. I’m pleased to say that all seven beat estimates, and some beat them by quite a lot. I’ll go over them all in a bit.

It’s not over. We have eight more reports coming next week. In this week’s CWS Market Review, I’ll preview them all. There’s a lot to get to, so let’s jump into our recent earnings news.

Seven Buy List Earnings Reports

Here’s our updated Earnings Calendar:

Let’s start with Check Point Software (CHKP). On Wednesday morning, the Israeli cyber-security firm said that its Q2 earnings rose by 15% to $1.58 per share. That beat expectations of $1.44 per share.

The numbers were pretty good. Quarterly revenue rose 4% to $506 million. Wall Street had been expecting $488 million. Cash flow from operations increased by 8% to $252 million. During Q2, Check Point bought back 3.1 million shares for a total cost of $325 million. The company continues to have a solid balance sheet, which is something I like to see.

Interestingly, Check Point said that cyber-attacks have increased during the pandemic. In May, the company documented 192,000 coronavirus-related cyber-attacks a week. On Wednesday morning, the shares gapped up as much as 5%, but they later settled back down.

I’m very impressed with Check Point’s business performance. This was a good quarter for them. This week, I’m raising our Buy Below on Check Point to $133 per share.

Stepan (SCL), the chemical company, reported Q2 adjusted net income of $1.65 per share. That’s up from $1.50 per share a year ago. Expectations were for $1.20 per share. Currency translation pinged them for 11 cents per share.

Stepan has three operating units. Surfactants made $48.5 million in Q2. Volume was up 10% thanks to increased demand for cleaning and disinfection products. Polymers made $15.5 million, and Specialty products made $3.2 million.

On Thursday, the shares broke out to a new all-time high. I’m lifting our Buy Below on Stepan to $117 per share.

Silgan Holdings (SLGN) is turning into a nice winner for us. Last week I told you I was expecting good news from them, and we got it. The metal-container firm earned 85 cents per share for the second quarter. That beat expectations of 65 cents per share. This was the strongest quarter in the company’s history. Net sales were up by 7.6% to $1.18 billion.

Silgan also did something very rare these days. The company increased guidance. Silgan now sees full-year earnings of $2.70 to $2.85 per share. Silgan also increased its free-cash-flow estimate for this year from $275 million to $330 million. At the current share price, that works out to a free-cash-flow yield of nearly 8.5%.

Shares of Silgan gained 7.8% on Wednesday. I’m raising our Buy Below to $42 per share.

Two of our financial stocks reported on Wednesday afternoon. Both have been poor performers this year, but both had good quarterly results.

Let’s start with Globe Life (GL). The insurance company reported fiscal Q2 operating earnings of $1.65 per share. That beat expectations of $1.53 per share.

The company narrowed its operating income guidance for this year. The previous range was $6.65 to $7.25 per share. Now Globe Life sees earnings ranging from $6.80 to $7.04 per share.

The stock gapped up 6.1% on Thursday, but it’s still down over 23% for the year. Don’t give up on GL. I’m raising our Buy Below to $84 per share. One more note. Later today, the Texas Rangers will be hosting the Colorado Rockies at the new Globe Life Field.

We also got earnings from Eagle Bancorp (EGBN). I was particularly curious to hear what Eagle had to say. Our thesis is that the bank is operating just fine but it’s been weighed down by unresolved legal issues.

The results confirmed our view. For Q2, Eagle made 90 cents per share which beat estimates of 74 cents per share. The bank now has $9.8 billion in assets. That’s up 13% over the last year.

The bank said that legal, accounting and professional fees increased by $1.2 million compared with the same quarter one year ago. That’s not so bad. It works out to about three cents per share. I think the market is starting to realize that we’re right. Shares of Eagle rallied 6.8% on Thursday. Eagle Bancorp remains a buy up to $34 per share.

We had two more Buy List earnings reports on Thursday. Danaher (DHR) said that quarterly earnings rose 32% to $1.44 per share. That’s a big beat. Wall Street had been expecting $1.09 per share. Revenue increased 19% to $5.3 billion.

For Q3, Danaher sees revenue growth “in the mid- to high-single digit range.” CEO Thomas P. Joyce, Jr., said, “We are very pleased with our second-quarter results—especially in such a challenging environment. Our solid revenue growth, strong cash-flow generation and more than 30% adjusted EPS growth are a testament to our team’s commitment to the Danaher Business System and the outstanding portfolio of businesses that comprise Danaher today.”

On Thursday, shares of Danaher got to another new high. We have a 30% profit with DHR this year. I’m raising our Buy Below to $212 per share.

Lastly, Hershey (HSY) said that quarterly sales fell 3.4% to $1.71 billion. The chocolatier had Q2 adjusted earnings of $1.31 per share. That beat Wall Street’s estimate of $1.13 per share. Hershey said it’s not providing any financial guidance at this time.

The company does expect accelerated sales growth in the second half of the year based on momentum exiting the second quarter, assuming no significant disruption to current consumer trends. The company also expects pricing and cost management to drive margin expansion in the second half of the year. We remain confident that our healthy balance sheet and strong cash flow will enable us to meet current business needs, invest for the future and return cash to stockholders.

Shares of HSY gained 5.7% on Thursday. Hershey remains a buy up to $150 per share.

Eight More Earnings Reports Next Week

Next week is going to be busy. We have eight Buy List stocks due to report.

RPM International (RPM) is scheduled for Monday. This is for the quarter that ended on May 31, which is their fiscal Q4. Companies are allowed a little more time to report their fiscal Q4. That’s why RPM reports in the middle of the normal earnings season.

In April, RPM reported Q3 earnings of 23 cents per share which was two cents better than expectations. Due to the coronavirus, RPM has decided to suspend its guidance. They also canceled any share buybacks. The good news is that RPM has a strong balance sheet and plenty of liquidity, so I’m hardly worried about their survival.

The now-canceled full-year guidance was for earnings between $3.30 and $3.42 per share. For Q4, RPM said it expects to see a sales drop of 10% to 15%. Wall Street expects earnings of $1.01 per share. The stock has been holding up fairly well. RPM has raised its dividend every year since 1973.

AFLAC (AFL) will report on Tuesday. The duck stock has struggled for us this year. AFLAC also withdrew its guidance, although the last earnings report was quite good. I was surprised to see AFLAC was trading below $35 per share not too long ago. That’s quite cheap. For Q2, Wall Street expects $1.07 per share. The duck should be able to beat that.

Shares of Sherwin-Williams (SHW) got to another high on Thursday. Its Q2 earnings are due out on Tuesday. Previously, the company lowered its full-year range to $16.46 – $18.46 per share with acquisition-related costs of $2.54 per share.

Sherwin recently increased its sales guidance for Q2. Sherwin now expects sales to decrease “by a mid-single-digit percentage” compared with last year. That may not sound so great, but the guidance before that was for sales to decrease “by a low- to mid-teens percentage.”

Many companies have withdrawn their guidance, which is certainly understandable, so I appreciate any background we can get. Wall Street expects Q2 earnings of $5.85 per share.

Cerner (CERN) will report on Wednesday. For Q2, the company sees revenue between $1.34 billion and $1.39 billion. For all of 2020, Cerner expects revenue between $5.55 billion and $5.70 billion. For earnings, Cerner expects EPS of 60 to 64 cents for Q2 and $2.78 to $2.90 for the full year.

Three more reports are scheduled for Thursday. For its Q1, Intercontinental Exchange (ICE) made $1.28 per share, which beat the Street by four cents. ICE had operating cash flow of $520 million, and free cash flow was $434 million.

CFO Scott A. Hill said, “In the first quarter we generated record revenues, record operating income and double-digit earnings-per-share growth, which enabled us to return over $850 million to stockholders through our dividend- and stock-buyback program.”

ICE gave several guidance metrics for Q2 and 2020, but none was EPS. I’ll highlight that ICE expects data revenue to be in a range of $565 million to $570 million. Wall Street is looking for earnings of $1.04 per share.

Moody’s (MCO) had a blow-out Q1. The ratings agency beat by 51 cents per share. Moody’s Investors Service had revenue growth of 19%, and Moody’s Analytics was up 5%.

For all of 2020, Moody’s sees earnings ranging between $7.25 and $7.85 per share. The shares are up 75% from their March low and are just below a new high. For Q2, analysts expect earnings of $2.19 per share.

Stryker (SYK) is one of those companies that’s so steady, you tend to forget how good it is. For Q1, Stryker beat by 15 cents per share. The company said that earnings were “significantly negatively impacted” by the coronavirus. Stryker has decided to forgo any guidance for this year. The Street’s consensus is for Q2 earnings of 55 cents per share.

Church & Dwight (CHD) made another new high for us on Thursday. This has been a steady winner for us. Unfortunately, C&D withdrew its guidance, but Wall Street expects Q2 earnings of 63 cents per share. Church & Dwight actually benefited from the coronavirus outbreak, especially brands like Arm & Hammer and some hygiene products.

This issue has been all about earnings, but I wanted to add a note on Becton, Dickinson (BDX). The company just got a massive order for 177 million syringes and needles for COVID-19 vaccination programs. Becton said it will start distributing the devices by the end of the year. Stay tuned for BDX’s earnings on August 5.

That’s all for now. We’re going to have more earnings reports next week. The Federal Reserve also gets together for another meeting on Tuesday and Wednesday. The policy statement will come out Wednesday afternoon, followed by a press conference by Fed Chairman Jerome Powell. On Thursday, we’ll get our first report on Q2 GDP, and it will be terrible. Wall Street is expecting a decline of 33%. I’m too scared to even make a guess. Be sure to keep checking the blog for daily updates. I’ll have more market analysis for you in the next issue of CWS Market Review!

– Eddy

P.S. Don’t forget to register for Tuesday’s webinar.

Morning News: July 24, 2020
Posted by Eddy Elfenbein on July 24th, 2020 at 7:02 am

Panic Selling Grips Chinese Stocks After U.S. Tensions Worsen

A Russian Gas Pipeline Increases Tension Between the U.S. and Europe

U.S. Economic Recovery Is Stalling and It May Get Even Worse

Here’s How Congress Might Replace the Extra $600 Weekly Jobless Benefit

A Hedge Fund Bailout Highlights How Regulators Ignored Big Risks

Fed Hoped To Skirt A Second Virus Wave. Small Businesses May Sink In It

New York City Reopening Splits Along Lines of Wealth and Race

Airbus Offers Subsidy Concession to End U.S. Tariffs

5 Big Numbers That Show Amazon’s Explosive Growth During The Coronavirus Pandemic

Mall Owner Simon Teams Up On Bid For Bankrupt Brooks Brothers

Goldman, Malaysia Reach $3.9 Billion Settlement Over 1MDB

Carlyle Co-CEO’s Abrupt Exit Caps a Long, Awkward Power Struggle

Cullen Roche: Three Things I Think I Think – Bad Tweets Edition

Joshua Brown: What Every Worker Needs To Know About Stock Based Compensation & Euro Snaps Ten Year Downtrend vs US Dollar

Michael Batnick: Why Everyone’s Trading & Animal Spirits: Edly ISA’s; Invest in Student Achievement

Ben Carlson: How Millennials Can Close the Generational Wealth Gap

Be sure to follow me on Twitter.

Two More Earnings Beats
Posted by Eddy Elfenbein on July 23rd, 2020 at 8:57 am

We had two more Buy List earnings reports this morning. Danaher (DHR) said that quarterly earnings rose 32% to $1.44 per share. That’s a big beat. Wall Street had been expecting $1.09 per share. Revenue increased 19% to $5.3 billion.

For Q3, Danaher sees revenue growth “in the mid- to high-single digit range.” CEO Thomas P. Joyce, Jr., said, “We are very pleased with our second quarter results—especially in such a challenging environment. Our solid revenue growth, strong cash flow generation and more than 30% adjusted EPS growth are a testament to our team’s commitment to the Danaher Business System and the outstanding portfolio of businesses that comprise Danaher today.”

Hershey (HSY) said that quarterly sales fell 3.4% to $1.71 billion. The company had Q2 adjusted earnings of $1.31 per share. That beat Wall Street’s estimate of $1.13 per share. Hershey said it’s not providing any financial guidance at this time.

The company does expect accelerated sales growth in the second half of the year based on momentum exiting the second quarter, assuming no significant disruption to current consumer trends. The company also expects pricing and cost management to drive margin expansion in the second half of the year. We remain confident that our healthy balance sheet and strong cash flow will enable us to meet current business needs, invest for the future and return cash to stockholders.

The other news this morning is that jobless claims rose for the first time since March. Initial claims increased by 109,000 to 1,416,000 (chart below). Continuing claims were 16,197,000.

Morning News: July 23, 2020
Posted by Eddy Elfenbein on July 23rd, 2020 at 7:06 am

South Korea Falls Into Recession As Exports Slump

Bounceback in U.S. Shale Oil Output is Unlikely to Last the Summer

Stimulus Bets Buoy Futures Ahead of Jobless Claims

Fannie-Freddie Risk Bonds Threaten Big Losses for Fund Managers

Private Equity’s Biggest Critic Sounds Off With His Final Warning

Big Tech CEOs Ready Defenses For U.S. Congress Hearing Into Their Growing Power

The Amazon Critic Who Saw Its Power From the Inside

Tesla Turns a Profit in a Pandemic-Squeezed Quarter & ‘Please Mine More Nickel,’ Musk Urges As Tesla Boosts Production

Luxury Cars Are Embracing ‘Drop’ Model Favored By Supreme, Nike

Surge In Eating At Home Cushions Virus Hit For Unilever

Escape From New York Pushes Hamptons Home Prices to 13-Year High

Landlords Jump the Gun As Eviction Moratorium Wanes

Joshua Brown: Oh. My. God.

Michael Batnick: The Light of History

Ben Carlson: Animal Spirits: 10,000 Day Traders

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Globe Life and Eagle Bank Beat Earnings
Posted by Eddy Elfenbein on July 22nd, 2020 at 4:16 pm

Today was a very good day for our Buy List. We were up 1.09% today which was 0.52% better than the S&P 500.

The nice earnings reports certainly helped. Silgan Holdings (SLGN) gained 7.8% and Stepan (SCL) was up by 3.4%. Check Point Software (CHKP) had been up by 5% earlier today but it eventually closed down by 1.1%.

After the closing bell, Globe Life (GL) reported fiscal Q2 operating earnings of $1.65 per share. The beat expectations of $1.53 per share.

Here are some highlights:

• Net income as an ROE was 9.4% for the six months ended June 30, 2020. Net operating income as an ROE excluding net unrealized gains on fixed maturities was 13.6%.
• Life premiums increased over the year-ago quarter by 8% at the Direct to Consumer Division and 7% at the American Income Life Division.
• Health premiums increased over the year-ago quarter by 7% at the Family Heritage Division.
• Life net sales at the Direct to Consumer Division increased over the year-ago quarter by 43%.
• Health underwriting margin increased over the year-ago quarter by 7%.

Also after the bell, Eagle Bancorp (EGBN) reported earnings of 90 cents per share. That beat expectations of 74 cents per share.

While the country at large experienced a very challenging environment in the second quarter of 2020 due to the COVID-19 pandemics extensive negative impacts to businesses and the economy in general, the banking industry faced significant related credit and interest rate challenges. In spite of these second quarter headwinds, we believe our Company has managed well, both in terms of our employee base staying healthy as well as staying in close contact with our many business relationships. As a result, we are pleased to report another quarter of overall favorable earnings, highlighted by continued growth in average loans and deposits, favorable operating leverage, and improved noninterest income, noted Susan G. Riel, President and Chief Executive Officer of Eagle Bancorp, Inc. Ms. Riel continued, The Companys assets ended the quarter at $9.8 billion, representing 13% growth over the second quarter of 2019. Second quarter 2020 earnings resulted in a return on average assets (ROAA) of 1.12%, return on average common equity (ROACE) of 9.84%, and a return on average tangible common equity (ROATCE) of 10.80%.

We have two more earnings reports tomorrow.

Five New Highs Today for the Buy List
Posted by Eddy Elfenbein on July 22nd, 2020 at 11:50 am

Sherwin-Williams (SHW), Silgan Holdings (SLGN), FactSet (FDS), Stepan (SCL) and Danaher (DHR) made new 52-week highs today.

A few other Buy List stocks like Ansys (ANSS), Trex (TREX), Moody’s (MCO) and RPM International (RPM) are close to new highs.

Ansys got five cents away.

Three Buy List Earnings this Morning
Posted by Eddy Elfenbein on July 22nd, 2020 at 8:58 am

We have five Buy List earnings reports due today and three came out before the opening bell.

Check Point Software (CHKP) said that earnings rose 15% to $1.58 per share. That beat expectations of $1.44 per share. Revenue rose 4% to $506 million. Wall Street had been expecting $488 million.

Stepan (SCL) reported Q2 adjusted net income of $1.65 per share. That’s up from $1.50 per share a year ago. Currency translation pinged them for 11 cents per share. Expectations were for $1.20 per share.

Silgan Holdings (SLGN) earned 85 cents per share for the second quarter. The beat expectations of 65 cents per share.

Globe Life (GL) and Eagle Bancorp (EGBN) will report later today.

Morning News: July 22, 2020
Posted by Eddy Elfenbein on July 22nd, 2020 at 7:05 am

Froth Returns to China’s Stock Market, Echoing the 2015 Crisis

Africa Starts to Have Second Thoughts About That Chinese Money

Insiders Who Nailed Market Bottom Are Starting to Sell Stocks

Here’s What’s Behind the ‘Perfect Storm’ Sending Silver Prices Surging

How Tesla Defined A New Era For The Global Auto Industry

In Electric Car Market, It’s Tesla and a Jumbled Field of Also-Rans

How to Sell Books in 2020: Put Them Near the Toilet Paper

Can Remote Work Growth Offset Stalls In Microsoft’s One-Time Deals?

How Ben & Jerry’s Perfected the Delicate Recipe for Corporate Activism

Avoid Airline Stocks, Trader Says As United Airlines Reports $1.6 Billion Loss

Joshua Brown: There Goes the Dollar

Howard Lindzon: My Favorite Investing Book

Jeff Carter: Request for Information From FDIC

Nick Maggiulli: There is Nothing Wrong With a Traditional Career

Ben Carlson: Generational Wealth Inequality

Be sure to follow me on Twitter.

The Home-Run Stocks Wall Street Doesn’t Know About
Posted by Eddy Elfenbein on July 21st, 2020 at 8:33 am

Imagine there’s a stock that’s up more than 30-fold in the last 20 years and it’s not followed by a single Wall Street investment analyst.

This investment has crushed just about every hedge fund out there, yet Wall Street is completely unaware of it.

Worst of all, it’s stock in a company that’s known by many. In fact, it’s a favorite of people who work on Wall Street.

The stock I’m talking about is Nathan’s Famous (NATH).

That’s right, the hotdog stand. Nathan’s is not only a great New York institution; it’s been a big long-term winner for investors.

Nathan’s is what we call an “Orphan Stock.” That means that it has zero or near-zero analyst coverage.

I love Orphan Stocks. They’re a great place to find overlooked values. Some of the big-name stocks on Wall Street are followed by 20, 30, even 50 analysts. These stocks live in glass fishbowls, but that’s not the case with Nathan’s, which, despite its name, apparently isn’t nearly as famous as I thought.

There are lots of great Orphan Stocks. Ever heard of Atrion (ATRI)? Don’t worry. You’re not alone.

Atrion is a medical-products company based in Dallas. Even though it’s small ($1.2 billion market cap), Atrion is strong in some niche markets like soft-contact-lens disinfection cases. Do you wonder who makes valves for life vests? There’s a good chance it’s Atrion.

Twenty-two years ago, you could have picked up one share of ATRI for $7. Recently, the stock got up to $665 per share.

Now I’m going to ask you a very easy question: Guess how many firms on Wall Street cover Atrion? I’ll give you a hint. It’s the same as Nathan’s.

That’s right. Zero.

The S&P 500’s had a good run over the years and it looks like a flat line in comparison to ATRI.

How can a stock rise so much for so long and no one on Wall Street has ever thought to start covering it? Part of the reason is they don’t bring Wall Street any investment banking business.

That’s more of a plus than a minus. It suggests the company hasn’t entered into any unwise mergers. Or taken on too much debt. Or been acquired at a poor price. Not needing a banker is hardly a bad thing.

Let’s also remember how hard the financial crises blew through Wall Street. The big houses simply don’t have the big research departments like they used to. The budgets have been cut back. As a result, there are lots of companies that get no analyst coverage.

Four years ago, Jason Zweig highlighted the best-performing stock of the last 30 years. Far from being a well-known large-cap tech stock, the big winner was Balchem (BCPC) of Wawayanda, NY. The company makes “flavorings, fumigating gases and nutritional additives for animal feed.”

Sexy!

From 1985 to 2015, Balchem gained over 107,000%. Zweig noted that Balchem didn’t attract a single major institutional holder until 1999. That was after it returned an average of 21.3% for the previous decade. Even today, Balchem is followed by a grand total of two analysts. Compare that with Facebook, which is followed by over 50.

Every earnings season, investors gather to see what companies have beaten expectations and what companies have fallen short. But for Nathan’s and other Orphan Stocks, there’s no “Street consensus” because no one follows them. For an investor, that’s another bonus. You don’t have to worry about the quarterly earnings game.

Consider an Orphan stock like Chase Corporation (CCF), which is a specialty-chemical company based in Westwood, MA. Chase is one of those Warren Buffett-style stocks. The only difference is that you have to move the decimal point over a few notches. Chase is a quiet firm that consistently generates strong cash flow. It’s a well-run cyclical, with gross margins typically around 35%. Best of all, Chase doesn’t carry a dime of long-term debt.

Over the last 25 years, Chase has gained nearly 6,000%. That’s enough to beat both Microsoft and Intel. Again, no one follows it.

These aren’t microcaps, either.

How about the wonderfully named U.S. Lime & Minerals (USLM)? Since 2003, it’s returned more than 30-fold (dividends included). Zero analyst coverage it. In 1990, Century Bancorp (CNBKA) hit a low of $1 per share. Today, it’s at $76 per share, and it’s paid dividends all along the way. Number of analysts. Zero.

Another benefit of investing in Orphan Stocks it that with fewer eyes watching a stock, there may be a better chance to finding a mispriced stock. I wouldn’t say the market is efficient, but the inefficiencies have a better chance of showing up where others aren’t looking for it.

Also, these businesses tend to fairly easy to understand. Orphans often don’t have arcane off-balance-sheet items or operating divisions around the world. A hobbyist-investor can invest an afternoon and read through a company’s SEC filings and be well-informed on the business.

If you have more questions, you can do something few investors think of: call the company and ask to speak to someone. Better-run companies are happy to speak with their investors. After all, the shareholders are the owners.

You’ll often hear that the type of value investing that Warren Buffett and Charlie Munger made their fortunes on is no longer possible in the world of mass data and Bloomberg terminals. That may be right in terms of amassing a multi-billion fortune, but there are plenty of companies operating well below Wall Street’s radar.

Here are a few examples of Wall Street Orphans

Miller Industries (MLR) of Ooltewah, Tennessee. Miller Industries makes and sells towing and recovery equipment. The company makes the wreckers used to move disabled vehicles.

They also make those multi-tier car carriers that you often see on the road. If a car or truck needs to be hauled out of something or hauled to somewhere, odds are Miller’s got a vehicle that can do it.

Miller Industries is a good example of a company with a strong “moat.” There are competitors, but it’s the dominant name in the business.

Since its low in 2000, MLR is up 8,000%. Zero analyst coverage.

Simulations Plus (SLP) makes software that lets drug companies simulate tests of their products in the virtual world before using any human or animal test subjects.

This is a big cost-saver for drug companies. Simulations Plus helps streamline the R&D process by making it faster and more efficient. Not only is this cost-effective, but it also helps drug companies deal with time-consuming regulatory hurdles.

Earlier this month, Simulations reported that net revenues rose 23.8% and gross profit increased 26.5%. Two analysts follow it. It was recently added to the S&P SmallCap 600.

The Texas Pacific Land Trust (TPL) has a colorful history. It was born over 130 years ago when the Texas and Pacific Railway went bust. The aim of the T&P was to build a southern transcontinental train route. Despite the name, the T&P never made it to California.

The railway was left with a ton of land of a ton of debt. The trust was formed with 3.5 million acres of land that the railway owned. People who held the railway’s worthless bonds got shares of the new land trust. Some oil came along, the trust made money and everyone was happy. Eventually, the shares started trading on the NYSE in 1927. (On a technical point, Texas Pacific Land Trust is not a REIT. It’s a land trust.)

In 1995, you could have picked up a share for $3.50. Recently, TPL’s been trading at $585. One analyst follows it.

The Hingham Institution for Savings (HIFS) dates back to 1834. In 1990, the stock was going for just over $1 per share, adjusted for splits. Today it’s at $178. Hingham has consistently increased its dividend over the last 25 years. I love how this company treats it shareholders. Last year, Hingham paid out a special dividend of 60 cents per share on top of its regular dividend.

In the chart below, Hingham is the black line. The blue line is Berkshire Hathaway.