Equity Strategies Group-Level Analysis Of The Equity Markets
New Airline Position
We are establishing a new 6% position in the airlines this month. I just heard five Wall Street firms put out new buy recommendations today. Let us hope the crowd is not always wrong.
The Divergences of August
Even though the S&P 500 edged into new high ground, with the DJIA coming within a hairbreadth of doing the same, a number of other stock indices have recovered less than half of their July losses.
July Sector Highlights (and Lowlights)
The highlights are few. All in all, this was a pretty bloody mess. I suspect most portfolio managers had a tough time holding their losses to less than the markets 6%.
Equity Leaders and Laggers
A rundown of the June and year to date sector leaders.
The Growth Stock Bargain Basket Returns
This issue we are making this computer screened quantitative theme a formal part of the equity model portfolio. It had been absent from the model since the fall of 1983. Floyd and Leuthold have tuned up this screen over the last few years and believe it is an excellent stock selection technique for the current environment.
Leaders & Laggers
Among the sectors we regularly monitor, the big winners in March were Medical Technology, Shelter and Ethical Drugs. High Tech sector issues and the Oil Patch sector were down on the month while the popular averages scored 5%-7% gains.
Leaders & Laggers
This publication monitors and regularly charts twenty market sectors and only six of these managed to beat the DJIA in February.
Time To Look At Shelter Stocks?
Several months ago Pulte Homes was added to our model as a "special situation" anticipating the possibility of a future broader move into the shelter area.
Gilt Edged Growth Time? We Think So
For several months now this publication has been waffling on this question.
October 1985 Screens
Jim Floyd has just completed a quarterly update on five stock selection screens. Some clients find this to be the most valuable work in our publications.
Conceptual Screens July 1985
Jim Floyd has just completed a quarterly update on four stock selection screens. Some clients find this to be the most valuable work in our publications. Herein, you will find the new additions and deletions for our Undervalued & Unloved, Consumer High Growth, Growth Bargain Basket and Bank Double Plays.
Utility Cash Cows…..Our Cash Cows in Confinement
Herein we present statistical tables of 46 public utilities that qualify as potential cash cows with cash flow now exceeding capital expenditures. We also isolate and grade the 24 utilities that we think look the best, explain the investment rationale in more detail and review the important factors investors should consider.
Cash Cows on the Loose…..and Cash Cows in Confinement
The “Cash Cow” theme Is divided into two parts. “Cash Cows on the Loose” are big cash generators that are immediate takeover or buyout candidates, and “Cash Cows in Confinement” are large free cash generating regulated utilities. Both categories are added to the model this issue. The use of regulated utilities may be a surprise to most readers.
Conceptual Screens, April 1985
Jim Floyd has just finished his quarterly update of four of our conceptual screens. Herein we present the stocks that have been added and deleted in “Undervalued & Unloved,” “Growth Bargain Basket,” “Bank Double Plays,” and “Consumer High Growth.” Descriptions and other statistical comparisons are included.
1984 Sector Winners and Losers
On a traditional broad sector basis, only three of the eleven sectors we track recorded positive returns in 1984. Looking at our Conceptual Sectors, there were eight of our sometimes unorthodox stock groupings with positive total returns.
The High-Tech Survivors
You may recall this publication turned very negative on High-Tech stocks in the late spring of 1983....certainly one of our better calls. In a summer 1983 Barron’s article, we projected a decline of 45% or more. Hell, it was more. Now it may be time to start buying them back. Some of these beaten up stocks will ultimately become established major factors in their fields. Which ones?
New Screens…Want Some New Stock Ideas?
Jim Floyd has just run new computer screens for the Consumer High Growth sector, Regional Bank Double Plays, the Undervalued & Unloved issues and the Growth Stock Bargain Basket. There are many changes. Each of these screens is discussed with all additions and deletions noted.
The Growing Popularity of Sector Rotation
Too many institutions are playing the sector rotation game. Typical portfolio turnover has increased considerably, and popularity has rotated faster than the rotary engine in a Mazda RX7. For the last year or so, our own sector strategies have been undergoing a change, becoming increasingly narrow. This is a significantly different approach than the broad economic sector approach that is now so popular.
Gilt Edged Growth Vs. Cyclical
During May, cyclical stocks fell almost 10.5%, while our Gilt Edged Growth stock index fell 7.4%. Thus, again on a relative basis, growth was better. Momentum now clearly favors growth and we think growth stocks have regained the upper hand.
A Timing Move from Cyclical to “Gilt Edged Growth”
Last issue we discussed the strong possibility of this transition. Now we are pretty sure it has taken place. The equity model portfolio is adjusted accordingly, eliminating the remainder of our Super Cyclical holdings and building positions in “Gilt Edged Growth Stocks.” We have also constructed a new index by which to track and evaluate 25 of the best.
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