Weekly Investor – January 19, 2021
Stocks Close Lower
Stocks closed lower last week. This short-term selloff goes against the longer upward trend for stocks. Recall, the S&P® 500 Index hit a record high during the first week of the year. Energy stocks led the market as oil prices reached levels not seen since February 2020. Although retail sales fell in December, e-commerce retailer Etsy, Inc. was the top performing stock in the S&P 500 last week. General Motors Company was also a top performer after the company announced a new electric Corvette SUV to compete with Ford Motor Company. Looking ahead to this week, the world will be focused on Wednesday’s inauguration and what is to come as the Biden administration begins its first 100 days with ambitious plans to fight the virus and support the economy. Investors will look for guidance from the new administration and Congress as the shifting political landscape has businesses changing strategies while the economy slowly climbs out of the COVID-19 hole from last year.
The S&P 500 Index was down 1.5% for the week. Its top-performing sectors were Energy (3.1%) and Real Estate (1.9%), while the bottom-performing sectors were Technology (-2.6%) and Communication Services (-3.6%). In the fixed-income market, the 10-year Treasury yield was even, ending at 1.1%.
We continue to seek companies that reflect our Change-BasedSM investment approach.
Change Based Investment
AbbVie Inc. is a U.S.-based pharmaceutical company founded in 2013. It originated as a spin-off from Abbott Laboratories. The company discovers, develops, manufactures and sells pharmaceutical products worldwide.
While it is widely known that AbbVie’s largest product, Humira, loses patent protection in 2023, recent new product launches, along with the acquisition of Allergan, a Dublin-based pharmaceutical company, have changed the growth opportunities for the company. For AbbVie, the acquisition of Allergan holds the potential for durable growth into the next decade with its BOTOX® Cosmetic treatment for wrinkles. Additionally, political uncertainty and concerns over potential changes to the health care system have resulted in an attractive valuation for AbbVie. AbbVie’s attractive valuation and growth potential makes AbbVie a compelling addition to Argent’s Large Cap Strategy.
Top 5 Equity Holdings
Large Cap Growth
| Apple, Inc. | 6.6% |
| Target Corporation | 6.4% |
| Alphabet, Inc.(Google) | 6.2% |
| Danaher Corporation | 5.3% |
| Mastercard Incorporated | 4.8% |
Small Cap Core
| OneMain Holdings, Inc. | 4.1% |
| Medpace Holdings, Inc. | 3.8% |
| PetIQ, Inc. | 3.2% |
| Fortinet, Inc. | 3.2% |
| Addus Homecare Corp. | 2.8% |
Dividend Select
| Target Corporation | 7.2% |
| JPMorgan Chase & Co. | 5.6% |
| Microsoft Corporation | 5.4% |
| Eaton Corporation Plc | 3.8% |
| Discover Financial Services | 3.8% |
Mid Cap
| NVIDIA Corporation | 4.7% |
| Marvell Technology Group | 3.9% |
| Zebra Technologies Corp. | 3.9% |
| Cintas Corporation | 3.7% |
| Nuance Communications | 3.7% |
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.
