Weekly Investor – January 11, 2021
Equity Markets Rise
Equity markets rose last week on expectations that more financial stimulus is forthcoming. The Senate runoff races in Georgia were both won by Democrats who have been promising $2,000 stimulus checks to a large portion of the U.S. population. As a result, inflation expectations and a potential rise in economic activity fueled a 1.8% gain in the S&P 500® Index last week. More economically sensitive cyclical stocks led the market, as Energy, Materials and Financials were the top three sectors. Oil rallied above $50 a barrel for the first time since last February on news that Saudi Arabia decided to cut oil production. As a result, four of the top ten performing stocks for the week were energy names. With the cyclical rally, value stocks outperformed growth stocks, as the S&P 500® Value Index gained 2.6% while the S&P 500® Growth Index only rose 0.4%. Looking to this week, news on the size of a government stimulus package will be closely watched.
The S&P 500 Index was up 1.8% for the week. Its top-performing sectors were Energy (9.3%) and Basic Materials (5.7%), while the bottom-performing sectors were Consumer Staples (-1.0%) and Real Estate (-2.6%). In the fixed-income market, the 10-year Treasury yield was up, ending at 1.1%.
We continue to seek companies that reflect our Change-BasedSM investment approach.
Change 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.
We believe AMETEK’s acquisitions in technology will make the company’s manufacturing more efficient and will be a catalyst for growth. AMETEK’s sales have been hurt near term from the effects of COVID-19. Longer term, 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
| Apple, Inc. | 6.7% |
| Alphabet, Inc.(Google) | 6.3% |
| Target Corporation | 6.2% |
| Danaher Corporation | 5.4% |
| Mastercard Incorporated | 5.2% |
Small Cap Core
| Medpace Holdings, Inc. | 3.8% |
| OneMain Holdings, Inc. | 3.7% |
| Fortinet, Inc. | 3.2% |
| PetIQ, Inc. | 3.1% |
| Addus Homecare Corp. | 2.9% |
Dividend Select
| Target Corporation | 7.2% |
| Microsoft Corporation | 5.5% |
| JPMorgan Chase & Co. | 5.4% |
| Eaton Corporation Plc | 3.9% |
| Discover Financial Services | 3.7% |
Mid Cap
| NVIDIA Corporation | 4.9% |
| Cintas Corporation | 4.0% |
| Zebra Technologies Corp. | 3.9% |
| Marvell Technology Group | 3.8% |
| Nuance Communications | 3.6% |
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.
