Research

In case you missed it, below is a digest of the most clicked on notes and videos with some key charts/tables that we’ve published month-to-date.  We’ve written about quality growth, price momentum, earnings, multiples, and the industrials and consumer sectors to name a few. In our pipeline, we are working on a spin-offs piece, computing

For generalist PMs and CIOs, the health of the US consumer and what to do with the related stocks appear at a crossroads. For consumer PMs and analysts, fishing for perspective outside of their typical pond also seems important. Hence, the timing of today’s inaugural Trivariate Consumer Level Set could not be better. We will

It became clear in August that the overwhelming consensus expectation was that the market would behave like a double-breaking putt. September would be a bad month for US equities, and then the market would rally into year end and finish the year at highs. So far, at least the first part of that is playing

To read Trivariate’s recent note on momentum click here.

At the index level, the US equity market is having a strong year so far in 2023. The S&P500 is up 16% year-to-date and the Nasdaq is up 31%. Things should be sweet. But with the sharp pullback on Friday, the S&P500 performance is exactly 0.00% this quarter. All those trades, and not a dollar

Price can disconnect from fundamentals for some time.  Some cyclicals in which investors believe in the long-term fundamentals (semiconductors, homebuilders, machinery) have performed relatively well this year despite obvious signs of a slowdown in some cases, while others lacking a long-term dream (airlines) have performed poorly.  In the end, saying you will focus on price

Summary:   Industrials Likely Don’t Outperform in a Downturn Can Industrials work in a down tape? The sector has performed well since COVID, but–as we have written many times, including in our newly launched Industrials Level Set product–we think high earnings expectations, high inventory, and lofty valuations are potentially an impediment to further outperformance.  We agree

Investing in equities typically involves a combination of changes to perceptions about growth and rates. Lately, growth has surprised to the upside. In fact, the bottom-up consensus earnings expectations for 2023 are now at the same level they were six months ago, bucking the typical trend of optimistic estimates that get downwardly revised (see below).

To read Trivariate’s recent research note on the Industrials sector click here.

Summary: Labor and Quality Growth Within industrials, we prefer the Rails and Services industries – where we see above industrial average estimate achievability with more attractive valuation. Within the more macro sub-segments, we prefer building products to machinery and electrical equipment. HVAC companies appear particularly well-positioned within building products to benefit from secular trends. Airlines