Weekly Investor – March 18, 2019
Strong Week for the S&P 500®
The S&P 500® Index posted its best week since November as investors applauded China’s renewed pledge to stimulate its economy. In addition, muted inflation data lef to optimism that the Federal Reserve will remain accommodative. In other economic news, retail sales and new housing starts came in above estimates.
The technology sector led the market last week, as the sector rose by nearly 5%. Shares of Broadcom Inc. jumped by 7% on Friday after the chipmaker maintained its current guidance, despite several headwinds faced by other semiconductor manufacturers. Nvidia Corp.’s shares gained after agreeing to purchase Mellanox Technologies. The deal should strengthen Nvidia’s exposure to datacenters. On the downside, Boeing Co. fell by over 10% for the week after a second crash of its new plane, the 737 Max, led to the grounding of its aircraft in numerous countries around the world, including the U.S. Looking ahead to this week, the Federal Reserve’s March meeting will be on investors’ minds. Investors expect continued patience from the Fed, especially with economic data points slowing over the last quarter.
The S&P 500 Index® was up 2.9% for the week. Its top-performing sectors were Technology (4.9%) and Health Care (3.2%), while bottom-performing sectors were Basic Materials (1.7%) and Industrials (0.3%). In the fixed-income market, the 10-year Treasury yield was even, ending at 2.6%.
We continue to seek companies that reflect our Change-BasedSM investment approach.
Changed-Based Investment
Founded in 1930, Ametek, Inc. is a U.S.-based manufacturer of electronic instruments and electromechanical devices. The company operates through two business segments supplying devices to the medical (quality control equipment), energy (temperature measurement and calibration instruments), industrial (battery chargers and UPS systems) and aerospace and defense (engine sensors, cockpit indicators and display systems) markets.
Over and above trading at an attractive valuation, we believe Ametek’s acquisitions in technology will make the company’s manufacturing more efficient and will be a catalyst for growth. Because of Ametek’s attractive valuation and acquisition strategy designed to increase efficiency and grow shareholder value, we believe Ametek fits our Changed BasedSM investment approach.
Top 5 Equity Holdings
Large Cap Growth
| Alphabet Inc. (Google) | 7.8% |
| Post Holdings, Inc. | 5.4% |
| Mastercard, Inc. | 4.8% |
| First Data Corporation | 4.4% |
| Fortive Corporation | 4.1% |
Small Cap Core
| Planet Fitness, Inc. | 3.0% |
| Fortinet Inc. | 2.9% |
| Merit Medical Systems | 2.8% |
| Wintrust Financial | 2.7% |
| Gray Television Inc. | 2.6% |
Dividend Select
| JPMorgan Chase & Co. | 5.6% |
| ConocoPhillips | 4.2% |
| Pfizer Inc. | 4.1% |
| Microsoft Corp. | 3.8% |
| Target Corporation | 3.7% |
Mid Cap
| CDW Corporation | 3.5% |
| Cintas Corporation | 3.4% |
| Xilinx Inc. | 3.3% |
| Amedisys, Inc. | 3.2% |
| Ciena Corporation | 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.
