Highlights Portfolio Strategy Frenzied software M&A activity, the ongoing capex upcycle, firming industry operating metrics and pristine balance sheets suggest that software stocks are a must have for equity portfolios. Rising…
Highlights Investors are worrying too much about the things that caused the global financial crisis, and not enough about those that could cause the next downturn. Despite the recent patch of soft data, the U.S. housing market is in…
Neutral In our recent initiation of coverage on the newly minted Communication Services sector, we examined the impact of a variety of technology and consumer discretionary stocks being pulled together to form a new GICS1…
One sector that saw some important changes was the S&P internet retail index, a sub-sector of consumer discretionary, with Netflix and TripAdvisor moving out and eBay moving in. Our thesis of continued elevated profit…
Underweight September was a tough month for the S&P hotels, resorts and cruise lines index. First, Carnival Corp, the largest cruise line operator warned that net revenue yield growth was slowing as prices for next year are flat;…
Neutral As we highlighted in yesterday’s Daily Insight, we are firmly housing market bulls. However, we are concerned that too much euphoria is priced into home improvement retail (HIR) equities. Three reasons underlie…
With the labor market at full employment and unemployment insurance claims on the verge of breaking below the 200,000 level, housing starts should regain their footing and propel homebuilding profits. In addition, the latest…
On the demand side, first-time home buyers still make only a third of total home sales and the homeownership rate is near generational lows, underscoring that pent up housing demand exists. In fact, the percentage of 18-34 year-…
Overweight While housing-related data releases have been slightly weaker than anticipated lately, we deem that this softness is transitory as housing market fundamentals rest on solid foundations. True, affordability has taken a hit…
Highlights Portfolio Strategy The firming long-term housing demand backdrop, lumber price cost relief, steady new home prices and favorable new home sales expectations, all signal that it is time to buy homebuilders. On the flip side…