Weekly Investor – Feb. 22, 2011
Momentum Continues
Market Summary:
The major U.S. equity averages extended their winning streak to three weeks, and the S&P 500 reached a level of double its March 2009 low. Against the backdrop of inflationary data and continued unrest in the Middle East and Africa, oil prices moved higher and the Energy sector ended the week as the best performing sector. In addition to Energy, higher raw material and food commodity prices contributed to a slightly higher than expected increase of the Producer Price Index (PPI) in January. With budget battles looming, positive readings of industrial production, and tightening Chinese monetary policy, there are plenty of cross-currents to keep investors on their toes.
Over the past week, top-performing sectors in the S&P 500® Index included Energy (+3.7%) and Health Care (+1.3%), while bottom-performing sectors included Telecommunications (-0.7%) and Utilities (-0.5%). In the fixed-income market, the 10-year Treasury remained steady during the week with the yield ending at 3.6%.
We continue to seek those companies possessing identifiable catalysts, and focusing on those stocks with favorable odds.
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Getting Paid to Wait
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 remote access 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. In addition, through its XenSource unit, CTXS is positioned to experience growth in the server and desktop 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
| . | |
|---|---|
| Qualcomm Inc. | 4.1% |
| Google Inc. | 4.0% |
| Danaher Corp. | 4.0% |
| EMC Corp. | 3.6% |
| Carnival Corp. | 3.6% |
| FactSet Research | 3.6% |
| Maxim Integrated | 3.5% |
| Oracle Corp. | 3.2% |
| Biogen Idec Inc. | 3.2% |
| MasterCard Inc. | 3.1% |
U.S. Equity Indices
| Index | 02/18/11 | Week % Chg | YTD % Chg |
|---|---|---|---|
| DJIA | 12,391.3 | 1.0% | 7.0% |
| NASDAQ | 2,834.0 | 0.9% | 6.8% |
| S&P 500 | 1,343.0 | 1.0% | 6.8% |
| Russell 1000 G | 616.8 | 1.0% | 7.3% |
U.S. Credit Rates
| Index | 02/18/11 | 02/11/11 | 12/31/10 |
|---|---|---|---|
| 3 Month T-Bill | 0.1% | 0.2% | 0.1% |
| 5 Year T-Note | 2.3% | 2.4% | 2.0% |
| 10 Year T-Note | 3.6% | 3.6% | 3.3% |
| 30 Year T-Bond | 4.7% | 4.7% | 4.3% |
| 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.
