Weekly Investor – September 8, 2015
A Turbulent Week
U.S. equity markets experienced continued turbulence last week and the S&P 500® fell 3.4%. Ongoing turmoil in China and growing concerns that the Federal Reserve will raise interest rates worried investors. A positive U.S. jobs report and the announcement that the U.S. unemployment rate fell to 5.1% fueled speculation on the upcoming interest rate hike. Additionally, the VIX index, a measure of market volatility, finished the week at 27.8. This is nearly twice as high as where the index averaged for the first seven months of this year as investors fixated on changes to the Chinese economy. Earlier in the week, China announced weak manufacturing data which indicated a contraction. Looking ahead to this week, investors will be paying close attention to any announcement from the Federal Reserve. Stay tuned…
The S&P 500® was down 3.4% for the week. The top-performing sectors in the S&P 500® Index included Telecommunications (-2.3%) and Consumer Discretionary (-2.3%), while bottom-performing sectors included Health Care (-4.4%) and Utilities (-5.2%). In the fixed-income market, the 10-year Treasury yield was down during the week, ending at 2.1%.
We continue to seek those companies possessing identifiable catalysts, and focusing on those stocks with favorable odds.
New Management
Endo International (ENDP) provides specialty healthcare solutions in the United States and internationally. ENDP was formerly known Endo Health Solutions Inc. and changed its name to Endo International in February of 2014. ENDP was founded in 1997 and is headquartered in Malvern, Pennsylvania.
In recent years, ENDP has been struggling with the successful execution of its pipeline across its multiple business segments. The company recently named Rajiv De Silva as CEO in an effort to help execution. Prior to joining ENDP, De Silva was an executive at Valeant Pharmaceuticals and assisted in the significant growth of the company. We expect De Silva to exercise his successful track record of creating shareholder value through his operational focus and value-added M&A background to ENDP. For these reasons, we believe ENDP offers favorable odds to our clients.
Top 10 Equity Holdings
| . | |
|---|---|
| Google, Inc. | 5.9% |
| Post Holdings, Inc. | 5.5% |
| Teva Pharmaceutical | 4.7% |
| Electronic Arts, Inc. | 4.1% |
| Danaher Corp. | 3.9% |
| ConAgra Foods, Inc. | 3.9% |
| Skyworks Solutions | 3.9% |
| F5 Networks, Inc. | 3.4% |
| Expedia, Inc. | 3.4% |
| Allergan plc | 3.2% |
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.
