Weekly Investor – Sept. 20, 2010
Regaining Traction
Market Summary:
The major U.S. equity averages ended the week with gains across the board. Better-than-expected earnings from major companies such as Best Buy and Oracle lifted investor sentiment. We also witnessed several M&A events and share buy-back announcements, possibly signaling that corporations are comfortable with their future prospects and thus ready to invest some of their cash reserves. Adding to the positive momentum during the week was the announcement of the Basel III global banking standard. With further clarity on the new capital requirements and years to implement changes, we hope to see banks become more flexible in granting loans and potentially resuming growth.
Over the past week, top-performing sectors in the S&P 500® Index included Technology (+4.4%) and Basic Materials (+1.8%), while bottom-performing sectors included Utilities (-0.9%) and Energy (-0.7%). In the fixed-income market the 10-year Treasury remained at the same level ending the week at 2.8%.
We continue to seek those companies possessing identifiable catalysts, and focusing on those stocks with favorable odds.
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Plenty of Room to Grow
Citrix Systems, Inc. (CTXS) develops, sells and supports application delivery products such as GoToMyPc, GoToMeeting, GoToAssist, GoToWebinar and other systems within its online services division. One such way these products work is by transmitting screen pixels, keystrokes and mouse movements by encrypted channel. CTXS’s main application is compatible with any platform, thus allowing for widespread use. Product training is also offered as a service so customers can optimize use of its various solutions.
With its existing remote access business, the company continues to gain momentum. Having completed the acquisition of XenSource, Inc., CTXS is positioned to experience growth in the server and virtualization markets. CTXS is the only company to offer an end-to-end application delivery infrastructure for the delivery of applications to any user. With positive feedback from our Main Street contacts, we believe CTXS will see significant growth from the fast and broad adoption of virtualization. We believe shares of CTXS can continue to outperform the market and its peers.
Top 10 Equity Holdings
| Cisco Systems Inc. | 4.1% |
| Newell Rubbermaid | 4.0% |
| Starwood Hotels | 4.0% |
| Google Inc. | 3.9% |
| Danaher Corp. | 3.8% |
| Energizer Holdings | 3.7% |
| Carnival Corp. | 3.4% |
| EMC Corp. | 3.3% |
| FactSet Research Systems | 3.3% |
| Biogen Indec Inc. | 3.3% |
U.S. Equity Indices
| Index | 09/17/10 | Week % Chg | YTD % Chg |
|---|---|---|---|
| DJIA | 10,607.9 | 1.4% | 1.7% |
| NASDAQ | 2,315.6 | 3.3% | 2.0% |
| S&P 500 | 1,125.6 | 1.5% | 0.9% |
| Russell 1000 G | 504.5 | 2.2% | 0.9% |
U.S. Credit Rates
| Index | 09/17/10 | 09/10/10 | 12/31/09 |
|---|---|---|---|
| 3 Month T-Bill | 0.2% | 0.1% | 0.1% |
| 5 Year T-Note | 1.4% | 1.6% | 2.6% |
| 10 Year T-Note | 2.8% | 2.8% | 3.8% |
| 30 Year T-Bond | 3.9% | 3.9% | 4.6% |
| Prime Rate | 3.3% | 3.3% | 3.3% |
This newsletter presents selected recommendations from portfolio managers of Argent Capital Management LLC, a registered investment advisor. Opinions reflect the portfolio manager’s judgment on the date above and are subject to change. A list of stocks recommended by Argent is available upon request. You should not assume that these recommendations are or will be profitable. In the course of it’s business, Argent’s client accounts may be buying and selling these stocks.
