Post by yogibearbull on Aug 7, 2021 14:37:07 GMT
Pg 10-11.
REVIEW. REVERSE-SPLITS are so rare that only 5 SP500 companies did it since 2012 including the recent 1-for-8 reverse-split of GE. In terms of split-adjusted price, GE peaked at $461 (2000) and is now trading around $100. CULP has been turning it around since 2018.
PREVIEW. Apple/AAPL is growing its digital ad business rapidly via Apple Store, Apple News, apps (Map, etc). This when it has taken steps on the Apple platform that hurt the digital ad businesses of other companies.
DATA THIS WEEK. JOLTS report on MONDAY; small business optimism index, labor cost and productivity on TUESDAY; CPI (headline 5.3%, core 4.3%), Treasury budget on WEDNESDAY; PPI, weekly initial jobless claims on THURSDAY; UM consumer sentiment on FRIDAY.
www.barrons.com/magazine?mod=BOL_TOPNAV
BULLISH. 5 “shovel-ready” infrastructure stocks focusing on engineering, design, inspection (early phases of infrastructure projects) (ATCX, J, MEG, PSN, TTEK; infrastructure capex bill is coming; several other infrastructure stocks are also mentioned including the ETF IFRA; pg 13);
European oil major Royal Dutch Shell (RDS.A/RDS.B; yield 5.0%/4.8%; UK-listed RDS.B doesn’t withhold tax for US investors; fwd P/E 8; EV/EBITDA 4.3; diversified including 46,000 retail service stations; depressed valuation due to high ESG sentiment in Europe and dividend cut in 2020 (increased but not yet at pre-pandemic level); plans to appeal Dutch court order to reduce carbon emissions by 45% vs its own goal of 20%; pg 14);
small-cap Spectrum Brands (SPB; yield 2.1%; fwd P/E 12.6; EV/EBITDA 9; reducing debt; many brands include Kwikset Locks, George Foreman Grills, Cutter (bug repellent), etc; it got out of its original batteries business (Rayovac, etc); bankruptcy in 2009; pg 15).
BEARISH. See other stories
Pg 12: FOLLOWUP. It was a wild weak for Robinhood/HOOD. It had a weak IPO debut last week but then caught fire. There were crosscurrents in the news – Cathie WOOD (ARK Investment) bought it, while some early investors filed to sell. Its valuation at P/S 35 doesn’t make any sense (common or otherwise). Stock is hard to borrow to short, but its options are very active (beware of buying expensive puts).
Pg 16: Whitney BAKER, Totem Macro (EM research and consulting). She has very negative views on recent Chinese crackdowns on its big tech, e-commerce, private education, property management companies. What were initially seen as targeted slap downs have become something much bigger. For the EMs, broad money and credit flows are important for her long and short recommendations for EM sectors and companies. The EMs will benefit from global recovery and re-leveraging/reflation. She likes EMs with higher rates/yields and those that are commodity-dependent, e.g. Chile, Columbia, Peru, Mexico. Some Eastern European banks may benefit from rising rates there. She is avoiding China, Taiwan, S Korea, Brazil. India looks interesting but is quite expensive. The US is facing inflation pressures because the government stimulus have been much bigger than that was needed and that has also manifested in strange ways (e.g. unwillingness to work when unemployment benefits are much better). The huge US QEs are keeping rates low; Treasury issues and the Fed buys (eventually). Some of the supply constraints we see are due to years of underinvestment in capex, especially within the US.
Pg 19: TECH TRADER. Covid-19-Delta or not, the US is going ahead with REOPENING. And people are also tired of sheltering in place. This is affecting companies differently. Rideshare businesses of UBER and LYFT are strong, but their costs are up sharply too, and they are also affected by changing labor regulations, so their stocks have been hit. Marketplace companies YELP and GRPN are favorably impacted. But negatively impacted are streaming companies ROKU, ZNGA and e-commerce companies AMZN, W, ETSY. A complication is that many companies, especially in CA, are delaying return to office dates. Elsewhere, Dan NILES (Satori Fund) recommends bottom fishing in the depressed Chinese stocks but use funds (KWEB) or baskets of stocks.
Pg 25: Barron’s 5th Annual Ranking (2021) of Robo-Advisors. Top 10 of 40 ranked:
#1-SoFi, #2-SigFig, #3-E*Trade (Morgan Stanley/MS), #4-Betterment, #5-Fidelity Go,
#6-Vanguard PAS, #7-Morgan Stanley/MS, #8-Axos Invest, #9-Wealthfront, #10-Ellevest
2020 #2 TD Ameritrade was acquired by Schwab. As new signups for TD Ameritrade were no longer possible, it was removed from consideration. In a side panel, the SEC investigation of Schwab SIP’s “no fees” claims while holding large % in cash at Schwab Bank is noted.
Pg 30: Sonu KALRA of blue-chip growth FBGRX (also the new active ETF FBCG) follows Peter LYNCH’s motto of “invest what you know (and use)”. Fund has 45.2% in top 10 holdings (total holdings 560), but he may start with tiny positions in new ideas (some from his teenage-kids and friends) and builds those over time. He even owns some meme stocks. He is watching the developments on regulation of big-techs.
Pg 32: FUNDS. The ESG funds are hot, but there are only a handful of ESG-value funds – only 12 mutual funds (CFJAX, PARWX, MSVVX, etc) and 8 ETFs (NULV, RAFE, ISMD, etc); most ESG funds are growth or blend. One reason is that ESG is an additional quality screen and that doesn’t leave much in traditional value categories (cyclicals in energy, mining, defense, entertainment/gaming, etc). So, the ESG-value funds tend to be more focused/concentrated. (It is not necessary to fill M* 9-box categories)
Pg 34: OTHER VOICES. Larry HATHEWAY, Jackson Hole Economics, formerly at UBS and GAM. Beware of global markets trading CALMLY at new highs. FAULT LINES underneath include pandemic, anti-vaxxers, social and economic inequality, climate change, populism, anti-globalization, US-China tensions, Brexit (and UK-EU issues), excesses (markets, economic, political). There is growing lack of trust in laws and institutions. Markets today are assuming gradual or continuous changes for resolutions of these fault lines, but the history shows that things can be far different.
Pg 35: INCOME. Growing e-commerce will benefit warehouse REIT PLD.
EXTRA. Companies with good and sustainable yields include SPG, PBCT, IBM, LYB, PRU, DOW.
(EXTRAS from online Friday that didn’t make the weekend paper version)
None (actually, several have been included where they belong better)
LINK
REVIEW. REVERSE-SPLITS are so rare that only 5 SP500 companies did it since 2012 including the recent 1-for-8 reverse-split of GE. In terms of split-adjusted price, GE peaked at $461 (2000) and is now trading around $100. CULP has been turning it around since 2018.
PREVIEW. Apple/AAPL is growing its digital ad business rapidly via Apple Store, Apple News, apps (Map, etc). This when it has taken steps on the Apple platform that hurt the digital ad businesses of other companies.
DATA THIS WEEK. JOLTS report on MONDAY; small business optimism index, labor cost and productivity on TUESDAY; CPI (headline 5.3%, core 4.3%), Treasury budget on WEDNESDAY; PPI, weekly initial jobless claims on THURSDAY; UM consumer sentiment on FRIDAY.
www.barrons.com/magazine?mod=BOL_TOPNAV
BULLISH. 5 “shovel-ready” infrastructure stocks focusing on engineering, design, inspection (early phases of infrastructure projects) (ATCX, J, MEG, PSN, TTEK; infrastructure capex bill is coming; several other infrastructure stocks are also mentioned including the ETF IFRA; pg 13);
European oil major Royal Dutch Shell (RDS.A/RDS.B; yield 5.0%/4.8%; UK-listed RDS.B doesn’t withhold tax for US investors; fwd P/E 8; EV/EBITDA 4.3; diversified including 46,000 retail service stations; depressed valuation due to high ESG sentiment in Europe and dividend cut in 2020 (increased but not yet at pre-pandemic level); plans to appeal Dutch court order to reduce carbon emissions by 45% vs its own goal of 20%; pg 14);
small-cap Spectrum Brands (SPB; yield 2.1%; fwd P/E 12.6; EV/EBITDA 9; reducing debt; many brands include Kwikset Locks, George Foreman Grills, Cutter (bug repellent), etc; it got out of its original batteries business (Rayovac, etc); bankruptcy in 2009; pg 15).
BEARISH. See other stories
Pg 12: FOLLOWUP. It was a wild weak for Robinhood/HOOD. It had a weak IPO debut last week but then caught fire. There were crosscurrents in the news – Cathie WOOD (ARK Investment) bought it, while some early investors filed to sell. Its valuation at P/S 35 doesn’t make any sense (common or otherwise). Stock is hard to borrow to short, but its options are very active (beware of buying expensive puts).
Pg 16: Whitney BAKER, Totem Macro (EM research and consulting). She has very negative views on recent Chinese crackdowns on its big tech, e-commerce, private education, property management companies. What were initially seen as targeted slap downs have become something much bigger. For the EMs, broad money and credit flows are important for her long and short recommendations for EM sectors and companies. The EMs will benefit from global recovery and re-leveraging/reflation. She likes EMs with higher rates/yields and those that are commodity-dependent, e.g. Chile, Columbia, Peru, Mexico. Some Eastern European banks may benefit from rising rates there. She is avoiding China, Taiwan, S Korea, Brazil. India looks interesting but is quite expensive. The US is facing inflation pressures because the government stimulus have been much bigger than that was needed and that has also manifested in strange ways (e.g. unwillingness to work when unemployment benefits are much better). The huge US QEs are keeping rates low; Treasury issues and the Fed buys (eventually). Some of the supply constraints we see are due to years of underinvestment in capex, especially within the US.
Pg 19: TECH TRADER. Covid-19-Delta or not, the US is going ahead with REOPENING. And people are also tired of sheltering in place. This is affecting companies differently. Rideshare businesses of UBER and LYFT are strong, but their costs are up sharply too, and they are also affected by changing labor regulations, so their stocks have been hit. Marketplace companies YELP and GRPN are favorably impacted. But negatively impacted are streaming companies ROKU, ZNGA and e-commerce companies AMZN, W, ETSY. A complication is that many companies, especially in CA, are delaying return to office dates. Elsewhere, Dan NILES (Satori Fund) recommends bottom fishing in the depressed Chinese stocks but use funds (KWEB) or baskets of stocks.
Pg 25: Barron’s 5th Annual Ranking (2021) of Robo-Advisors. Top 10 of 40 ranked:
#1-SoFi, #2-SigFig, #3-E*Trade (Morgan Stanley/MS), #4-Betterment, #5-Fidelity Go,
#6-Vanguard PAS, #7-Morgan Stanley/MS, #8-Axos Invest, #9-Wealthfront, #10-Ellevest
2020 #2 TD Ameritrade was acquired by Schwab. As new signups for TD Ameritrade were no longer possible, it was removed from consideration. In a side panel, the SEC investigation of Schwab SIP’s “no fees” claims while holding large % in cash at Schwab Bank is noted.
Pg 30: Sonu KALRA of blue-chip growth FBGRX (also the new active ETF FBCG) follows Peter LYNCH’s motto of “invest what you know (and use)”. Fund has 45.2% in top 10 holdings (total holdings 560), but he may start with tiny positions in new ideas (some from his teenage-kids and friends) and builds those over time. He even owns some meme stocks. He is watching the developments on regulation of big-techs.
Pg 32: FUNDS. The ESG funds are hot, but there are only a handful of ESG-value funds – only 12 mutual funds (CFJAX, PARWX, MSVVX, etc) and 8 ETFs (NULV, RAFE, ISMD, etc); most ESG funds are growth or blend. One reason is that ESG is an additional quality screen and that doesn’t leave much in traditional value categories (cyclicals in energy, mining, defense, entertainment/gaming, etc). So, the ESG-value funds tend to be more focused/concentrated. (It is not necessary to fill M* 9-box categories)
Pg 34: OTHER VOICES. Larry HATHEWAY, Jackson Hole Economics, formerly at UBS and GAM. Beware of global markets trading CALMLY at new highs. FAULT LINES underneath include pandemic, anti-vaxxers, social and economic inequality, climate change, populism, anti-globalization, US-China tensions, Brexit (and UK-EU issues), excesses (markets, economic, political). There is growing lack of trust in laws and institutions. Markets today are assuming gradual or continuous changes for resolutions of these fault lines, but the history shows that things can be far different.
Pg 35: INCOME. Growing e-commerce will benefit warehouse REIT PLD.
EXTRA. Companies with good and sustainable yields include SPG, PBCT, IBM, LYB, PRU, DOW.
(EXTRAS from online Friday that didn’t make the weekend paper version)
None (actually, several have been included where they belong better)
LINK