Weekly Investor – December 16, 2019
Phase One Deal?
The S&P 500® Index rose last week. The equity index has posted nine positive weeks in the last ten weeks of trading. With just days remaining from the potential tariff increases, the United States and China trade deal was the focus of many investors last week. News reports with minimal details of a potential phase one trade deal had equities rally to a new closing high on Thursday. As some trade deal details emerged on Friday, conflicting reports caused equities to experience volatile trading day, though the index managed to produce another all-time closing high. The S&P 500 Index has returned nearly 29% this year, with just over two weeks remaining in 2019.
In stock news, Western Digital Corporation, a memory and storage device manufacturer, was the best performing stock in the S&P 500 Index last week returning 10.6%. Micron Technology, Inc., a memory chip manufacturer, climbed 6.8% last week. Both companies were beneficiaries of positive Wall Street reports saying memory prices were hitting their bottom. Earnings announcements expected this week include NIKE, Inc., Micron Technology, Inc., FedEx Corporation, Carnival Corporation, General Mills, Inc., Paychex, Inc., and a few others.
The S&P 500® Index was up 0.7% for the week. Its top-performing sectors were Technology (2.0%) and Consumer Discretionary (1.1%), while the bottom-performing sectors were Communication Services (-0.7%) and Real Estate (-2.6%). In the fixed-income market, the 10-year Treasury yield was even, ending at 1.8%.
We continue to seek companies that reflect our Change-BasedSM investment approach.
Change Based Investment
Carlisle Companies Incorporated operates as a global diversified manufacturing company. It designs, manufactures and markets a wide range of products that serve a broad range of niche markets including commercial roofing, lawn and garden, mining and construction equipment, aerospace and electronics, energy, agriculture, food delivery and healthcare.
The company has had a significant transformation over the years. As a result of this change, Carlisle is well-positioned to grow in its markets and make small acquisitions to augment its organic growth. After a few years of tariff and cost headwinds, the stock is trading at a compelling valuation. The company’s growth potential and compelling valuation make Carlisle Companies an attractive addition to the Argent Large Cap Strategy.
Top 5 Equity Holdings
Large Cap Growth
| Alphabet Inc. (Google) | 7.8% |
| Mastercard, Incorporated | 5.4% |
| Fiserv, Inc. | 5.3% |
| Target Corporation | 5.1% |
| Post Holdings, Inc. | 4.9% |
Small Cap Core
| Fortinet, Inc. | 3.0% |
| Atkore International Group | 3.0% |
| World Fuel Services | 2.7% |
| OneMain Holdings, Inc. | 2.7% |
| Callaway Golf Company | 2.5% |
Dividend Select
| JPMorgan Chase & Co. | 6.3% |
| Target Corporation | 5.4% |
| Microsoft Corporation | 4.5% |
| Fidelity National Financial | 3.8% |
| Comcast Corporation | 3.5% |
Mid Cap
| CDW Corporation | 4.4% |
| Cintas Corportaion | 3.8% |
| Amedisys, Inc. | 3.7% |
| Copart, Inc. | 3.3% |
| NVR, Inc. | 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.
