Core Viewpoint - Large cap growth companies have significantly driven market gains in 2025, prompting investors to reconsider the role of value-oriented investments in their portfolios. A balanced approach using two free cash flow (FCF) ETFs, the VictoryShares Free Cash Flow Growth ETF (GFLW) and VictoryShares Free Cash Flow ETF (VFLO), is suggested to capture potential upside regardless of market conditions [1]. Group 1: Investment Strategy - The GFLW and VFLO ETFs utilize FCF as a key metric for evaluating equities, which is increasingly important in the current market environment [2]. - GFLW focuses on large-cap companies with the potential to compound FCF over time, assessing both trailing and future FCF to determine growth potential [6]. - VFLO targets companies with the highest FCF yields, emphasizing those that can allocate capital towards enhancing shareholder value through reinvestment, share buybacks, or dividends [7]. Group 2: Market Dynamics - Over the past 15 years, growth has consistently outperformed value, as indicated by the disparity in P/E ratios between the Russell 1000 Growth Index and the Russell 1000 Value Index [2]. - The valuation landscape has shifted in the last five years, with growth stocks trading at a premium compared to value stocks, leading to a widening gap that may introduce risks of growth underperformance if the spread contracts [4]. Group 3: ETF Characteristics - Both GFLW and VFLO are designed to limit exposure to companies with slow growth prospects, thereby reducing the risk of value traps [8]. - The Victory U.S. Large Cap Free Cash Flow Index, tracked by VFLO, selects high-quality companies based on profitability screens and strong FCF yield, rebalancing quarterly [12]. - The Victory Free Cash Flow Growth Index, tracked by GFLW, emphasizes profitable companies with a positive FCF trend and high growth potential [13].

January 22, 2026 GE Aerospace fourth quarter & full year 2025 performance Financial results & company highlights Caution concerning forward-looking statements: This document contains "forward-looking statements" – that is, statements related to future events that by their nature address matters that are, to different degrees, uncertain. For details on the uncertainties that may cause our actual future results to be materially different than those expressed in our forward-looking statements, see www.geaerosp ...

Core Insights - Analysts are raising their price targets for McDonald's Corp. (MCD) stock ahead of the earnings announcement, indicating a positive outlook for the company [1][3] - MCD's stock price is currently at $307.08, showing an increase from a low of $299.86 on January 5 and a peak of $319.65 on December 18, 2025 [1][3] Price Target Analysis - The average price target from 37 analysts is now $332.87, up from $331.20 a month ago and $330.10 in November 2025, reflecting a growing confidence in the stock [4] - Barchart's mean survey price target is $339.00, an increase from $337.53 a month ago and $336.43 earlier [5] - AnaChart's survey of 23 analysts shows a price target of $349.98, slightly lower than $352.03 in December but still above $338.35 in November, leading to an average of $340.62, implying an upside of almost 11% from the current price [6] Investment Strategy - Shorting out-of-the-money (OTM) puts is suggested as a strategy to potentially lower the buy-in price while earning a premium [1][6] - An example provided indicates that shorting a $300.00 strike price put option yielded a premium of $2.01, resulting in a one-month yield of 0.67% [7][8]

Core Viewpoint - Microsoft Corp. (MSFT) stock has been trading within a range, and shorting out-of-the-money (OTM) put options has been a profitable strategy, currently offering a 1.5% income yield for a one-month 4% OTM put option [1]. Group 1: Stock Performance - As of January 9, 2026, MSFT is trading at $475.35, down from $492.02 one month ago and $496.82 two months ago [1]. - A month prior, on December 9, 2025, MSFT was at $491.00, with a recommended short on the $475.00 put option [2]. Group 2: Options Strategy - Investors received $5.63 per contract for the $475.00 put option, translating to a one-month income yield of 1.185% based on an investment of $47,500 [3]. - The current $455.00 strike price put contract for February 6, 2026, has a midpoint premium of $7.60, offering an immediate yield of 1.67% [6]. Group 3: Price Targets and Analyst Sentiment - MSFT stock could potentially reach $682.55 per share over the next 12 months, supported by strong FY 26 Q1 results and a 33% free cash flow (FCF) margin [4]. - Analysts have raised their revenue forecasts, with 57 analysts increasing their price targets to $622.51, slightly down from $626.71 two months ago [5]. - Barchart's mean price target is $630.07, compared to $632.77 two months prior, indicating that analysts still view MSFT as undervalued [5].

Core Viewpoint - High dividend yields, such as 10% or more, can attract income-focused investors but often indicate significant underlying risks associated with the company's financial health [1][2]. Group 1: High-Yield Dividend Stocks - A list of high-yield dividend stocks includes FS KKR Capital Corp. (17.39%), Dynex Capital, Inc. (14.77%), and AGNC Investment Corp. (13.36%) among others, with market caps of at least $2 billion [4][6]. - The dividend yield is calculated as annual dividend divided by stock price, meaning a stock's yield can appear attractive if its price has significantly dropped [5][7]. Group 2: Risks Associated with High-Yield Stocks - A payout ratio exceeding 100% indicates that a company is using its capital to maintain dividends, which is unsustainable and may lead to dividend cuts [5]. - Companies in cyclical sectors may rely on debt to fund dividends during downturns, increasing the risk of bankruptcy [5]. - Investors should assess a company's free cash flow (FCF) to ensure it can sustain high dividend payments, as insufficient cash generation is a red flag [7][8]. Group 3: Tax Considerations - Many high-yield stocks, such as REITs and BDCs, pay non-qualified dividends, which are taxed at higher marginal income tax rates compared to qualified dividends from established companies [9][10]. - It is advisable for investors seeking high yields to consider holding non-qualified stocks in tax-advantaged accounts to mitigate tax liabilities [9].

Core Insights - The article emphasizes the importance of free cash flow (FCF) as a critical metric for assessing a company's financial health, beyond traditional metrics like revenue and net profit [1][5]. Definition and Importance of FCF - Free cash flow is defined as the cash generated by a company after covering its operating expenses and capital expenditures, calculated using the formula: FCF = Operating Cash Flow – Capital Expenditure [3]. - FCF is a more reliable indicator of a company's financial health compared to earnings, as it reflects actual cash available for dividends, share buybacks, debt repayment, and business expansion [4][5]. Implications of Strong FCF - A high FCF indicates financial stability, the ability to sustain dividends, and flexibility to adapt to market changes, as seen in companies like Apple and Microsoft [6][7]. - Strong FCF is often associated with a company's capability to continuously generate profits for shareholders [7]. Implications of Weak or Negative FCF - Low or negative FCF can signal potential issues, such as excessive reinvestment needs or rising capital expenditures that may lead to debt problems [8]. - High-growth companies like Amazon and Tesla may report lower or negative FCF temporarily due to prioritizing expansion, necessitating investor discernment between strategic reinvestment and structural weaknesses [9]. Utilizing FCF in Stock Analysis - Investors should examine FCF trends over several years and consider the FCF margin to assess how effectively a business converts sales into cash [10]. - Focusing on the price-to-FCF ratio rather than earnings provides a more reliable measure of a company's market value relative to its available capital, making it a valuable tool for value investors [10]. Conclusion - Understanding FCF helps investors avoid pitfalls such as yield traps and overleveraged companies, emphasizing the importance of cash flow as a clear measure of a company's strength [11].

Core Viewpoint - Palo Alto Networks (PANW) has reported strong Q3 free cash flow (FCF) and an increase in FCF margin on a trailing 12-month basis, indicating potential undervaluation of the stock, making it attractive for value investors [1] Financial Performance - PANW's stock is currently trading at $189.76, significantly below its recent peak of $221.28, suggesting a potential buying opportunity [1] - Analysts have set a price target of $212.16 per share, which is 11.8% higher than the current price, based on strong FCF margins and revenue forecasts [2] - The average price target from 55 analysts is $225.42, an increase from $224.59 a month ago, indicating positive sentiment among analysts [3] Options Strategy - Shorting out-of-the-money (OTM) put options has been discussed as a strategy to establish a lower potential buy-in point while generating income [4] - A previous short-put strategy involved a $180 strike price put option, which yielded a short-put yield of 2.56% for the next month, demonstrating the effectiveness of this approach [5] - Current options data shows that the $180 strike price put option for January 23, 2026, has a midpoint premium of $2.28, providing a one-month yield of 1.267% [6] - For less risk-averse investors, shorting the $185.00 put option offers a yield of 1.9189% for an investment of $18,500 [7]

Core Viewpoint - Out-of-the-money (OTM) put options for Alphabet, Inc. (GOOGL) present a potential 1.77% return for short-sellers over the next month, while the stock has a projected upside of 32% based on free cash flow (FCF) targets [1][3]. Group 1: Stock Performance and Options Strategy - GOOGL closed at $309.29 on December 12, slightly below its recent peak of $323.44 on November 25, with a potential valuation of $408.27 over the next year [1]. - The article discusses leveraging OTM put options and in-the-money (ITM) calls to capitalize on GOOGL's upside [3]. - A previous short on the $275.00 strike price put option yielded a 1.764% return, while GOOGL's stock increased by 6.8% over the last month, outperforming the OTM short-put return [4]. Group 2: Free Cash Flow and Valuation - Based on strong FCF margins, GOOGL could be valued over $408 within the next 12 months, with the last quarter's FCF margin rising to 23.9% from 19.98% a year earlier [6]. - Assuming a conservative FCF generation of $90 billion to $100 billion in 2026, GOOGL's stock could be valued between $4.5 trillion and $5 trillion, indicating a potential increase of approximately $1 trillion or 26.8% from its current market cap of $3.746 trillion [7].

Core Insights - The S&P 500 Index is reaching new highs, prompting advisors to seek ways to maintain equity exposure while managing valuation risks. Free cash flow (FCF) is highlighted as a crucial tool for identifying high-quality investment opportunities in the current market [1][2]. Group 1: Importance of Free Cash Flow - Free cash flow is essential for cutting through market noise characterized by high valuations and concentration in mega-cap stocks, particularly in the context of rising AI-related capital expenditures [2][5]. - Companies with strong and sustainable cash generation are positioned for long-term growth, enhancing portfolio resiliency [2]. - Historical trends show that growth and value investing come in cycles, with current allocations being 23% towards growth and 15% towards value [3]. Group 2: FCF Mechanics and Evaluation - The evaluation of FCF involves analyzing a company's cash flow relative to its enterprise value, aiming to identify companies with attractive valuations based on profitability [8][16]. - Key metrics include FCF yield and return on invested capital (ROIC), which provide a comprehensive measure of profitability [8]. Group 3: FCF ETF Strategies - Victory Capital offers several ETFs focused on FCF, including: - VictoryShares Free Cash Flow Growth ETF (GFLW), which targets U.S. companies with high FCF profitability [9]. - VictoryShares Free Cash Flow ETF (VFLO), focusing on large-cap U.S. stocks with favorable growth prospects [9]. - VictoryShares Small Cap Free Cash Flow ETF (SFLO), investing in profitable small-cap companies with high FCF yields [9]. - International options include VictoryShares International Free Cash Flow ETF (IFLO) and VictoryShares International Free Cash Flow Growth ETF (GRIN) [10]. Group 4: FCF Flexibility and Market Resilience - A FCF strategy is beneficial during economic slowdowns, as companies with substantial cash reserves can better withstand market downturns [11]. - The emphasis on diversifying portfolios with a focus on free cash flow is recommended for navigating various market conditions [12].

Core Viewpoint - The lawsuit against StubHub Holdings, Inc. alleges that the company's IPO documents were misleading by failing to disclose significant adverse trends affecting its Free Cash Flow, which dropped to negative $4.6 million, representing a 143% decline [1] Group 1: Allegations and Financial Impact - The complaint claims that StubHub's Registration Statement and Prospectus did not disclose known trends that were negatively impacting the company's Free Cash Flow [1] - The Free Cash Flow for Q3 2025 was reported as negative $4.6 million, marking a 143% decline from the previous year [1] - Following the earnings news, StubHub's stock fell over 20%, trading as low as 56% below the IPO price of $23.50 [1] Group 2: Legal Issues and Next Steps - The lawsuit focuses on whether the omission of adverse changes in vendor payment timing violated the Securities Act of 1933 [1] - Investors who acquired shares traceable to the IPO and suffered losses are encouraged to contact Hagens Berman for potential compensation [1] - The deadline for investors to move the Court for appointment as lead plaintiff is January 23, 2026 [1]