Post by Admin/YBB on May 20, 2023 5:38:26 GMT -6
Pg 10-11. FOMC Minutes on WEDNESDAY.
REVIEW. Warren BUFFETT/BRK bought COF, C, PARA, HPQ and added to several Japanese trading houses. He sold MRK, BMY, ABBV, TSM (on China-Taiwan concerns). It isn’t clear which were traded by WB who handles 90% of the portfolio, and which by his assistants COMBS and WESCHLER who run the rest 10%.
PREVIEW. After a hit by the short-seller Hindenburg, Carl ICAHN and IEP are into a proxy fight for 3 board seats at ILMN + Grail. Later, he wants to dump the Chairman THOMPSON and CEO deSOUZA, and wants ILMN to sell Grail, that the FTC also wants.
DATA THIS WEEK. New home sales, manufacturing PMI, services PMI on TUESDAY; Q1 GDP (2nd est) on THURSDAY; durable goods report, wholesale inventories, personal income and consumption expenditures (core PCE +4.4% y-o-y) on FRIDAY.
www.barrons.com/magazine?mod=BOL_TOPNAV
BULLISH. Apple (APPL; Apple Savings 4.15% via GS; fintechs (PYPL, SQ, BNPL, AFRM, etc) should be wary of AAPL moving into several bank-like services; pg 14);
European building materials (aggregates, gravel, etc) CRH (fwd P/E 11 (low); US sales 60%, profits 75%; moving listing from Ireland to the US NYSE; can then tap into the US government incentives for infrastructure, jobs, reshoring; its business is local due to high transportation costs of building materials; pg 15);
Morgan Stanley (MS; Chairman/CEO James GORMAN (64) announced that he will step down as the CEO within 12 months but will remain as Executive Chairman for a while; the leading candidates for replacement are Andy SAPERSTEIN (wealth management), Ted PICKS (institutional securities), Dan SIMKOWITZ (investment management, corporate strategy); pg 16);
Anheuser-Busch InBev (BUD; yield 1.4%; fwd P/E 18.; outlook is good despite the recent Bud Light ad/PR fiasco and subsequent boycotts; only 30% of profits are from the US; many strong global brands; pg 17).
BEARISH.
Pg 12: David SOLOMON, Goldman Sachs/GS. The GS stock has done well under him (10/2018- ), but he is still on a hot seat. Its tiny consumer banking Marcus has disappointed (banking has become difficult due to high rates, portfolio losses and possible new regulations following several regional bank failures and rescues); his DJ gigs raise eyebrows (he says that media ignores his other interests in golfing, biking, kitesurfing); some internal deals involving clients (he says that compliance was followed); firm’s past ties with Jeffery Epstein (he says that was for the general counsel when she was at a prior law firm); stock’s low P/E and P/B; rival Morgan Stanley’s/MS successful expansion into asset management. The capital markets have been tough. He sees future growth in consumer banking and asset/wealth management. GS is a big company run by a partnership structure (400+ partners). He listens to everybody, but it is not possible to make everyone happy.
Pg 27, FUNDS. UK large-cap-growth Scottish Mortgage Investment Trust (STMZF; AUM $17 billion; ER 0.30%; leverage 12%; discount 23.1%; PFIC for the US taxes; name is historical but now misleading) is a closed-end fund (equity) managed by Baillie Gifford. It has 60% US exposure and has 30% in private companies. New manager Tom SLATER replaced retired James ANDERSON last year.
Pg 28, INCOME INVESTING. BONDS will benefit from FED pause or pivot. Steady and/or declining rates are good for bonds; stick with short- and intermediate- term funds (BSV, AGG, LQD). HY may look attractive but beware of a possible recession.
Pg 28: ECONOMY. The FED may hike or pause at the June FOMC. The recent economic data have been strong (or not collapsing) – manufacturing, housing, jobs, etc. There have been no follow-on panics in the regional banks. There is only some tightening in financial conditions and bank lending.
Pg 29, TECH TRADER. For transformative AI, bigger may be better – MSFT (ChatGPT/Bing AI), GOOGL (Bard), ORCL, NVDA. Smaller players are C3.ai/AI, PLTR, SOUN. Related areas are picks-and-shovels (MRVL, DNS, MU), data technologies (SNOW, DDOG), cybersecurity (PANW, ZS), apps (HUBS). In miscellaneous areas are ADBE, DUOL, NOW.
Pg 30: #BookTok community of TikTok/ByteDance has been very beneficial for book authors, booksellers, publishers, social-media influencers (who are paid by publishers for promos). They are concerned about a national TikTok ban; Montana has just banned it. If the ban comes, these activities may eventually move to META, GOOGL, AMZN, but they all exist now and haven’t been effective so far.
Pg 62, OTHER VOICES. Christopher SMART, Barings Investment Institute; formerly, the US Treasury and the White House. The G-7 summit in Hiroshima, Japan will address INDUSTRIAL POLICIES related to climate change and China, but they may go too far as there is already consensus on these issues. They are also easier than dealing with Russia-Ukraine war. The Western governments deploy regulations, taxes, tariffs, tax incentives, subsidies, sanctions for implementation rather than direct central planning.
(EXTRAS from online Friday that didn’t make the weekend paper version)
See Column Topics. It seems some consolidation/rearrangement of Columns is going on.
Accessible from Morningstar (M*), PB-Big Bang, Facebook (“at”yogibearbull), Twitter (“at”YBB_Finance).
REVIEW. Warren BUFFETT/BRK bought COF, C, PARA, HPQ and added to several Japanese trading houses. He sold MRK, BMY, ABBV, TSM (on China-Taiwan concerns). It isn’t clear which were traded by WB who handles 90% of the portfolio, and which by his assistants COMBS and WESCHLER who run the rest 10%.
PREVIEW. After a hit by the short-seller Hindenburg, Carl ICAHN and IEP are into a proxy fight for 3 board seats at ILMN + Grail. Later, he wants to dump the Chairman THOMPSON and CEO deSOUZA, and wants ILMN to sell Grail, that the FTC also wants.
DATA THIS WEEK. New home sales, manufacturing PMI, services PMI on TUESDAY; Q1 GDP (2nd est) on THURSDAY; durable goods report, wholesale inventories, personal income and consumption expenditures (core PCE +4.4% y-o-y) on FRIDAY.
www.barrons.com/magazine?mod=BOL_TOPNAV
BULLISH. Apple (APPL; Apple Savings 4.15% via GS; fintechs (PYPL, SQ, BNPL, AFRM, etc) should be wary of AAPL moving into several bank-like services; pg 14);
European building materials (aggregates, gravel, etc) CRH (fwd P/E 11 (low); US sales 60%, profits 75%; moving listing from Ireland to the US NYSE; can then tap into the US government incentives for infrastructure, jobs, reshoring; its business is local due to high transportation costs of building materials; pg 15);
Morgan Stanley (MS; Chairman/CEO James GORMAN (64) announced that he will step down as the CEO within 12 months but will remain as Executive Chairman for a while; the leading candidates for replacement are Andy SAPERSTEIN (wealth management), Ted PICKS (institutional securities), Dan SIMKOWITZ (investment management, corporate strategy); pg 16);
Anheuser-Busch InBev (BUD; yield 1.4%; fwd P/E 18.; outlook is good despite the recent Bud Light ad/PR fiasco and subsequent boycotts; only 30% of profits are from the US; many strong global brands; pg 17).
BEARISH.
Pg 12: David SOLOMON, Goldman Sachs/GS. The GS stock has done well under him (10/2018- ), but he is still on a hot seat. Its tiny consumer banking Marcus has disappointed (banking has become difficult due to high rates, portfolio losses and possible new regulations following several regional bank failures and rescues); his DJ gigs raise eyebrows (he says that media ignores his other interests in golfing, biking, kitesurfing); some internal deals involving clients (he says that compliance was followed); firm’s past ties with Jeffery Epstein (he says that was for the general counsel when she was at a prior law firm); stock’s low P/E and P/B; rival Morgan Stanley’s/MS successful expansion into asset management. The capital markets have been tough. He sees future growth in consumer banking and asset/wealth management. GS is a big company run by a partnership structure (400+ partners). He listens to everybody, but it is not possible to make everyone happy.
Pg 27, FUNDS. UK large-cap-growth Scottish Mortgage Investment Trust (STMZF; AUM $17 billion; ER 0.30%; leverage 12%; discount 23.1%; PFIC for the US taxes; name is historical but now misleading) is a closed-end fund (equity) managed by Baillie Gifford. It has 60% US exposure and has 30% in private companies. New manager Tom SLATER replaced retired James ANDERSON last year.
Pg 28, INCOME INVESTING. BONDS will benefit from FED pause or pivot. Steady and/or declining rates are good for bonds; stick with short- and intermediate- term funds (BSV, AGG, LQD). HY may look attractive but beware of a possible recession.
Pg 28: ECONOMY. The FED may hike or pause at the June FOMC. The recent economic data have been strong (or not collapsing) – manufacturing, housing, jobs, etc. There have been no follow-on panics in the regional banks. There is only some tightening in financial conditions and bank lending.
Pg 29, TECH TRADER. For transformative AI, bigger may be better – MSFT (ChatGPT/Bing AI), GOOGL (Bard), ORCL, NVDA. Smaller players are C3.ai/AI, PLTR, SOUN. Related areas are picks-and-shovels (MRVL, DNS, MU), data technologies (SNOW, DDOG), cybersecurity (PANW, ZS), apps (HUBS). In miscellaneous areas are ADBE, DUOL, NOW.
Pg 30: #BookTok community of TikTok/ByteDance has been very beneficial for book authors, booksellers, publishers, social-media influencers (who are paid by publishers for promos). They are concerned about a national TikTok ban; Montana has just banned it. If the ban comes, these activities may eventually move to META, GOOGL, AMZN, but they all exist now and haven’t been effective so far.
Pg 62, OTHER VOICES. Christopher SMART, Barings Investment Institute; formerly, the US Treasury and the White House. The G-7 summit in Hiroshima, Japan will address INDUSTRIAL POLICIES related to climate change and China, but they may go too far as there is already consensus on these issues. They are also easier than dealing with Russia-Ukraine war. The Western governments deploy regulations, taxes, tariffs, tax incentives, subsidies, sanctions for implementation rather than direct central planning.
(EXTRAS from online Friday that didn’t make the weekend paper version)
See Column Topics. It seems some consolidation/rearrangement of Columns is going on.
Accessible from Morningstar (M*), PB-Big Bang, Facebook (“at”yogibearbull), Twitter (“at”YBB_Finance).