Underweight While year-to-date chip equipment stocks are the best performing index in the SPX, we deem them a mania, and include them in our high-conviction underweight basket for 2020. The top panel shows this irrational…
Highlights Portfolio Strategy Interest rates are one of the most important macro drivers of overall equity returns via valuations. BCA’s view of a selloff in the bond market is a key factor underpinning most of our 2020 high-…
Underweight We reiterate our recent downgrade in the S&P semi equipment index to underweight. Our previous mid-year attempt to fight this rally in chip equipment stocks fell short, but thankfully our prudent risk management metric…
Neutral (Downgrade Alert) Tech stocks have been on a tear with the sector besting the SPX by over 40% since 2015. While such a breakneck pace is unsustainable, what is missing from this outperformance is relative forward earnings…
Underweight Bellwether CSCO’s latest guidance was weak and confirmed that the capex-laden S&P communications equipment tech sub-index is in for a rough ride. Worryingly, CSCO’s key enterprise segment has no…
The communications equipment rally stalled early in the summer and has since morphed into a bear market. The darkening profit outlook for this niche tech sub-group warrants remaining underweight. Bellwether CSCO’s latest…
The large weight of the tech sector in the US stock market explains much of the superior performance of US stocks over the past decade. EPS in the I.T. sector has grown a lot more quickly than in other sectors. Looking out,…
Dear Client, Instead of our regular weekly report next Monday, this Friday November 22, you will receive our flagship publication “The Bank Credit Analyst” with our annual investment outlook. Our regular publication service…
Dear Client, I will be visiting clients in Paris, Amsterdam, and London next week. In lieu of our regular report, we will be sending you a Special Report from Matt Gertken, BCA’s Chief Geopolitical Strategist. Matt argues that US…