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Q1 So Far – Some Tears, Some Laughter, No Real Conviction

80 of the 132 companies that comprise our industry group indices have reported earnings for the first calendar quarter of 2012.  On average we have seen positive surprises (67 companies), but at the same time we have seen negative near-term

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Cheap Tech Redux: Sifting Through the Bargain Bin Again

A year ago, TMT stocks set a 20 year P/E low relative to the S&P500.  Since then, tech has rallied back almost halfway to its historical relative P/E.  However, the rising tide is not lifting all boats, with the dispersion

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Metals and Mining – Discounting Much More Than Appears To Be Going On

The metals sector remains attractive in our valuation framework, and at the larger cap company level the appeal is broad, with the best only fairly valued, and most well below fair value. This suggests that a basket approach owning the

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Healthcare Demand is (Cyclically) Improving Ahead of Estimates and Share Prices; Something Has to Give

Estimates for healthcare stocks appear too low in light of improving healthcare demand; this is especially true for healthcare sub-sectors that are highly geared to changes in patient volumes (our favorites being Non-Rx Consumables, Hospitals, and HMOs) Over the past

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North American Commodity Chemicals – Shale Gale Maybe, Windfall More Definitely

As production of natural gas in the US has risen it has increased not just the volume of methane available, but also the amount of associated gases; ethane, propane, butane and natural gasoline.  With the exception of ethane, these products

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April 4, 2012 – Sector and Sovereign Industrials Launch – Graham Copley

  Today we have initiated coverage of the Industrials and Basic Industries Sectors. Outperformance over the past 6 months despite negative revisions has sadly led the group as a whole to be, in aggregate, fairly valued – limiting our initial

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Telecom Carriers: Why Aren’t These Cyclicals Cycling?

  Telecom ought to be cyclical, but lately, it hasn’t been.  Other asset intensive, low marginal cost industries have seen capex turn upward over the past few years, driven by recovery, low interest rates and tax incentives, while capex by

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Why Losing the Individual Mandate is Good for HMOs, and other Earnings Consequences of Various Supreme Court Outcomes

We expect the Supreme Court to rule on the Affordable Care Act (ACA) this June/July (i.e. to find the Anti-Injunction Act does not apply), and to let the Medicaid expansion stand (driving a 13 percent gain in Medicaid spending, &

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Television Networks: Betwixt and Between a World of Change

  The cable era broke the domination of the broadcast networks, ushering choice to consumers and diluting audiences.  In the emerging online era, content creators, advertisers, and viewers are all gaining leverage over the traditional multichannel model, which puts an

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Accelerating Growth in Hospitals’, Physicians’ Offices and Other Care Settings’ Labor Hours Signals Improving Healthcare Demand

Reported earnings are a surprisingly weak indicator of near-term changes in healthcare demand; the dominant settings of care (hospitals, physicians’ offices) are vastly under-sampled   In contrast, monthly aggregate labor hours offer a timely and broad-based sample of activity in

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