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发帖数: 355 | 1 Americas : Market Intelligence – Morning Update
微信公众平台 USOPTIONS
by Chris Hussey
Published April 1, 2014
Stocks in Asia traded Tuesday with a slight positive bias as China's
official March PMI Manufacturing survey came in a touch better than expected
(50.3 vs 50.1 consensus). Japan's Nikkei index was the notable
underperformer as the country implements a 300bp higher sales tax today and
the February Monthly Labor Survey showed a disappointing 30bp decline in
wages - this despite concerted efforts by the Abe administration to jump-
start inflation after decades of growth-stifling deflation in the country.
European equities are trading moderately higher this morning as investors
react to an inline final manufacturing PMI for March - a survey that
continues to show economic recovery in Europe's periphery with both Italy
and Spain recording small increases in the dispersion index. Additionally,
March unemployment in Germany declined - evidence perhaps that the long-
awaited global growth acceleration may be positively impacting this export-
driven economy.
Checking the pulse of US Industrials after a hard winter. Steve Song and
team parse more than 80 data points across the Industrials landscape in "
Around the World in 80 Datapoints." Lead infrastructure indicators in China
continue to soften, but investors seem more focused on the stimulus
narrative in the near-term. In Europe industrial indicators are beginning to
support the ongoing recovery story. In the US, however weather driven
weakness continues to be seen in short-cycle indicators heading into March.
Non-residential construction seems to have taken a pause in February.
Brightest spot: trucking data.
Solar technology striving to keep up with the stocks. Solar stocks have
enjoyed explosive growth lately with many of the US bellwethers doubling or
tripling over the past 12 months. And in the "Global Clean Energy Monthly,"
Brian Lee and team dive deep into technology gains across the sector to
gauge whether the science can match the stock market performance. Notably,
Investor scrutiny around the potential for further technology gains in solar
is increasing following First Solar’s accelerating conversion efficiency
roadmap to 19.5% by 2017 (vs. c.13% in 2013). We believe the push to higher
efficiency, however, is not limited to First Solar – which notably has the
steepest curve. Currently at 16%-17%, on average, efficiencies at Tier-1
Chinese suppliers appear on track to improve toward 19%+ in coming years
owing to process improvements and a shift toward monocrystalline. In our
coverage, we see this leading to cost advantages favoring Chinese Tier-1
plays (CSIQ, JKS – both Neutral) near-term, with FSLR (Sell) appearing most
competitive longer-term if it can execute on out-year targets.
Looking Ahead: The national ISM manufacturing survey is scheduled to be
released this morning (GS forecast 53.0) and we also get March automobile
sales throughout the day and a February Construction Spending report to kick
off April.
Performance of global indices
As of April 01, 2014
Source: Reuters
Today's Events:
09:00 am - Markit PMI - Mar-final
10:00 am - Construction Spending - Feb
10:00 am - ISM Survey - Mar
05:30 pm - Domestic Motor Vehicles Sales - Mar
05:30 pm - Lightweight Motor Vehicles Sales - Mar
US Morning Call for April 01, 2014:
Asia Strategy, Moe: 2Q views: Rebound; favor a three-part cyclical cocktail.
Look for stock market gains in Asia in 2Q14 driven by accelerating growth in
China and the US. Northern Asia is particularly under-owned. Buy: China and
India reform beneficiaries and growth cyclicals over asset-sensitive
financials.
Asset Managers, Irizarry: Retail reactivating: A look into 1Q’s equity
mutual fund flow.
Waddell & Reed (WDR, Buy), Irizarry: Consistency and growth profile
underappreciated; upgrade to Buy.
Active equity mutual fund growth is accelerating as retail investors re-
engage in stocks. Upgrade WDR to Buy and raise 12-month target to $84, as
it should gain share through its active equity offering and operating
leverage is under-appreciated.
Specialty Pharmaceuticals, Nachman: Urologist helps refresh our views on key
drivers for AUXL & ENDP.
We raise estimates for Buy-rated AUXL on increased confidence that it’s new
erectile dysfunction drug – Stendra – can gain a meaningful share of the
market.
BE Aerospace, Inc. (BEAV, CL-Buy), Poponak: Buy on order strength, and ahead
of Hamburg + investor day.
CL-Buy BEAV is entering a catalyst-rich period with new orders likely to
come out of next week’s Hamburg Aircraft Interiors Show, potential news at
its May 5th Investor Day, and 1Q14 results in between (which have been de-
risked by recent orders announcements). 12-month target $106.
Multi-Industry, Ritchie: C1Q14 preview: Position into laggards with strong
EPS growth path.
Given ytd under-performance, we see room for select Multi-Industry stocks to
outperform through 1Q results as weather headwinds are well known and a
post-quarter growth acceleration is likely. Standouts: PH (Buy) and IR (
Neutral).
Homebuilders, Hackel: Spring update: March accelerates; LEN implies little
non-core value.
Homebuilders, Hackel: Builder Blueprint – March: Dispersion continues with
CA/FL/TX strong but others soft.
Homebuilders have sold-off sharply over the last month as spring selling
activity has disappointed. But we believe March New Home Sales will
accelerate from February as our MetroStudy tracker finally inflected
positively last week. Conversations with builders also remain encouraging.
Favorite stock: CL-Buy LEN.
Coupons Inc (COUP, Neutral), Evaluating a potential inflection in CPG
couponing; Initiate Neutral.
We initiate coverage of on-line coupon facilitator COUP at Neutral as the
market already fully discounts the success of a just-launched store coupon
app that still faces execution uncertainty in our opinion. 12-month target,
$21.
Notable Research not on the call:
Macro
•US Daily, Mericle: The Cold Winter Retreats Slowly
•Fixed Income Monthly: Springtime, Bond Bears Awaken
•Global LNG: The next 10 years: Looking softer on the back end
•China: Official PMI inched up in March
Energy
•Global Clean Energy Monthly: Spotlight on continued upside in the
solar technology roadmap, plus lower cost per watt
•Targa Resources Partners LP (NGLS): Increased guidance, new projects
reinforce our Buy thesis on TRGP
Financials
•Brazil: Banks: Analyzing asset quality trends through the mix shift;
adding Itaúsa to the Spotlight List
Healthcare
•Generic Pharmaceuticals: Supreme Court to hear Copaxone litigation;
the debate continues
Industrials
•US Industrials: Around the World in 80 Datapoints: Uncertain global
macro, bullish sentiment on US growth prospects
•Apogee Enterprises, Inc. (APOG): Focus on orders into 4Q14; recent
macro data points encouraging
•Agriculture: Prospective Planting & Grain Stocks bullish corn /
bearish soy
Conference Calls & Conferences:
•April 4 @ 11 AM EDT – GS Research Energy Friday Conf Call Series:
“Haynesville Shale: Defining the geologic and financial opportunity” with
EXCO Resources’ Mark F. Mulhern (CFO), Harold H. Jameson (VP of Asset
Management) and Marcia R. Simpson (VP of Engineering); hosted by Brian
Singer; Dial-in: 973-528-0056; passcode: 624831. |
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