Weekly Investor – October 15, 2018
Rough Week for the S&P 500
Last week, equities had their worst week since March, after the S&P 500® Index fell more than 4%. The index was negative for six straight trading days before finally finishing in the green Friday.
Overall, however, we remain positive on equities. According to Bloomberg, corporate earnings are projected to grow 24% over the next 12 months in the S&P 500, giving it a 16x forward P/E ratio close to historical averages. Real GDP for the year is projected to be over 3% for the first time since 2005. Employment and consumer confidence remain strong, and the Federal Reserve remains accommodative with a target rate of 2.25%.
The S&P 500 was down -4.1% for the week. Its top-performing sectors were Utilities (-1.3%) and Consumer Staples (-1.9%), while bottom- performing sectors were Industrials (-6.4%) and Basic Materials (-6.6%). In the fixed-income market, the 10-year Treasury yield was down slightly, ending at almost 3.2%.
We continue to seek companies that reflect our Change-BasedSM investment approach.
Changes at Boston Scientific
Boston Scientific Corporation (BSX) develops, manufactures and markets medical devices used in a broad range of interventional medical specialties.
Boston Scientific has undergone a multi-year turnaround effort that has been driven by several new product introductions yielding positive results for the company. We believe these encouraging changes have put Boston Scientific in position to be a leading growth company within the medical device space. With its potential for accelerating sales growth and improving profitability, we feel Boston Scientific fits well with Argent’s Change-BasedSM investment approach.
Top 5 Equity Holdings
Large Cap Growth
| Alphabet Inc. (Google) | 7.7% |
| Post Holdings, Inc. | 5.2% |
| Baxter International | 4.9% |
| MasterCard, Inc. | 4.5% |
| Apple Inc. | 4.2% |
Small Cap Core
| Fortinet, Inc. | 3.7% |
| Wintrust Financial Corp. | 2.9% |
| Merit Medical Systems | 2.8% |
| Health Ins. Innovations | 2.7% |
| Premier, Inc. | 2.3% |
Dividend Select
| JPMorgan Chase & Co. | 5.6% |
| ConocoPhillips | 4.6% |
| Pfizer, Inc. | 4.4% |
| Occidental Petroleum | 4.3% |
| Target Corporation | 4.1% |
Mid Cap
| NVIDIA Corporation | 3.4% |
| Cintas Corporation | 3.2% |
| NetApp, Inc. | 3.1% |
| CDW Corporation | 3.1% |
| Amedisys, Inc. | 3.0% |
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.
