Market Commentary

April 14th 2018

Total Q1 earnings for the S&P 500 index are expected to be up +16% from the same period last year on +7.4% higher revenues, the highest quarterly earnings growth pace in 7 years. Earnings growth is expected to be in double-digit territory from the year-earlier level for 11 of the 16 FATI sectors, including the Technology and Finance sectors. Only two sectors (Autos & Conglomerates) are expected to show earnings declines in Q1.

Energy sector earnings are expected to be up +60.1% from the same period last year on +16.1% higher revenues. Excluding the Energy sector, total S&P 500 earnings growth drops from +16.1% to +14.6%.

The most profound change on the earnings scene lately has been the unusually positive revisions trend for Q1 and the following quarters. This is a sight that we haven’t seen in a very long time; definitely not in the last 6 years. The most important factor driving this positive revisions trend is the tax cuts. The rise in oil prices and the impact of higher bond yields on banks’ profitability are some of the other factors.

Featured RecommendationsPatrick Industries, Inc. 

$56.65 (PATK)

Patrick Industries, Inc. is a major manufacturer of component products and distributor of building products and materials for the Recreational Vehicle, Manufactured Housing and Marine industries. The Company also supplies many of its products to certain Industrial markets that include customers in the kitchen cabinet, office and household furniture, fixtures and commercial furnishings and other industrial markets. Patrick’s major manufactured products include decorative vinyl and paper laminated panels, solid surface, granite and quartz countertops, fabricated aluminum products, wrapped vinyl, paper and hardwood profile moldings, slide-out trim and fascia, cabinet doors and components, fiberglass bath fixtures, fiberglass and plastic helm systems and component products, wiring and wiring harnesses, and composite parts and polymer-based flooring and other products. Patrick Industries also distributes pre-finished wall and ceiling panels, drywall finishing products, and other miscellaneous products.
Target Price $62.32

FATI® Market Rankings

Ranking Market Cap 1 Mth 3 Mth 6 Mth 9 Mth 12 Mth RSR % Stocks Up % Stocks Dwn YTD Return
1 Micro Caps 0.0% -1.0% 4.0% 10.0% 17.0% 1 20.0% 21.0% 3.87%
2 Small Caps -1.0% -3.0% 4.0% 10.0% 17.0% 1 18.0% 24.0% 1.01%
3 Nano Caps -2.0% -5.0% 2.0% 4.0% 8.0% 0 18.0% 16.0% -1.12%
4 Mid Caps -2.0% -4.0% 2.0% 7.0% 13.0% 0 21.0% 24.0% -1.03%
5 Large Caps -2.0% -5.0% 2.0% 7.0% 13.0% 0 16.0% 31.0% -0.96%
6 Mega Caps -2.0% -5.0% 2.0% 7.0% 15.0% 0 26.0% 28.0% -0.92%
FATI® S&G Index -1.54%

FATI® Sector Rankings

Ranking Sector 1 Mth 3 Mth 6 Mth 9 Mth 12 Mth RSR % Groups Up % Groups Dwn YTD Return
1 Medical -2% 0% 8% 9% 24% 2 0.0% 0.0% 6.73%
2 Retail/Wholesale 0% -5% 0% 0% 2% 2 0.0% 50.0% -0.30%
3 Aerospace 2% 0% 7% 20% 34% 1 0.0% 100.0% 6.14%
4 Basic Materials 0% -5% 10% 20% 21% 1 0.0% 40.0% 0.49%
5 Industrial Products 0% -3% 6% 11% 22% 1 16.0% 50.0% -1.56%
6 Oil & Energy 2% -10% 2% 6% 0% 1 14.0% 0.0% -3.25%
7 Construction -2% -12% 3% 9% 13% 0 50.0% 50.0% -7.28%
8 Computer/Technology -4% -3% 1% 7% 18% 0 28.0% 57.0% 1.90%
9 Consumer Discretionary -1% -5% 3% 6% 14% 0 33.0% 50.0% -3.40%
10 Consumer Staples 0% -5% 1% 1% 2% 0 33.0% 16.0% -0.93%
11 Transportation -4% -8% 0% 4% 9% -1 50.0% 50.0% -2.06%
13 Finance -2% -4% 0% 2% 8% -1 0.0% 28.0% -7.28%
14 Business Services -4% -6% -1% 2% 1% -1 50.0% 50.0% -4.74%
15 Utilities 0% -2% -6% 0% 1% -1 0.0% 25.0% -5.73%
16 Auto/Truck -1% -10% -4% 7% 19% -2 0.0% 0.0% -4.76%
17 Multi-Conglomerate -2% -10% -4% -1% 8% -2 0.0% 100.0% -7.66%
FATI® S/G Index -1.54%

Long Trades

Ticker %Chg EPS F1 EPS Grth % F1 EPS Grth % F2 # Anlst in F1  Con. Est. P/E using  F1 Est Mkt Cap Millions FATI Score Next EPS Report Date
SPX 1.06 42.42 55.75 3 17.55 3.12
IP 3.73 40.34 49.71 5 10.87 $21,977 3.26 20180426
KS 3.21 46.02 59.85 4 17.98 $3,375 6.46 20180425
AMN 4.78 32.81 48.31 3 18.88 $3,060 2.56 20180503
GES 9.39 41.43 75 3 23.52 $1,915 5.34 20180523
PATK 3.87 35.06 51.02 4 13.19 $1,443 3.27 20180426

Short Trades

Ticker %Chg EPS F1 EPS Grth % F1 EPS Grth % F2 # Anlst in F1  Con. Est. P/E using  F1 Est Mkt Cap Millions FATI Score Next EPS Report Date
SPX 1.06 42.42 55.75 3 17.55 3.12
ELLI -1.53 -25.05 44.66 5 112.01 $2,965 6.76 20180426
BANC -31.98 -27.24 40.6 6 30.92 $935 8.97 20180502

GREEN – Favored Stock
RED – EPS Report ALERT

FATI Score – Measures the dispersion of earnings estimates of analysts. The lower the score the the lower the earnings uncertainty. Scores of 12 or lower are only considered for long trades.

 

Recent Featured Recommendations

Rec. Date Ticker LONG / SHORT % G/L S&P 500 % +/- S&P 500 H/L Price Target Price 8% Stop Price Next EPS Date
1/5/18 MAS $44.46 -8.01% -3.27% -4.74% $40.90 $48.91 $40.90 2/8/18
1/12/18 RGA $163.65 -8.00% -4.66% -3.34% $150.56 $180.02 $150.56 1/29/18
1/19/18 HBAN $15.81 5.00% 5.48% -0.48% $16.60 $17.39 $14.55 1/30/18
1/26/18 AIT $74.70 -8.01% 7.54% -15.54% $68.72 $82.17 $68.72 4/26/18
2/3/18 CI $204.46 -8.00% 3.83% -11.83% $188.10 $224.91 $188.10 5/4/18
2/10/18 MTH $45.00 13.33% 1.38% 11.95% $51.00 $49.50 $41.40 4/26/18
2/17/18 NSIT $35.42 3.95% -2.86% 6.81% $36.82 $38.96 $32.59 5/2/18
2/24/18 ARCB $33.05 6.05% -3.43% 9.48% $35.05 $36.36 $30.41 5/4/18
3/3/18 CR $91.86 5.90% 1.32% 4.58% $97.28 $101.05 $84.51 4/23/18
3/10/18 KFY $49.59 7.95% 1.58% 6.36% $53.53 $54.55 $45.62 6/19/18
3/17/18 CBPX $27.75 5.95% 3.60% 2.34% $29.40 $30.53 $25.53 5/3/18
3/24/18 CVTI $31.26 -8.00% -2.56% -5.44% $28.76 $34.39 $28.76 4/19/18
3/31/18 XPO $101.81 0.41% -3.73% 4.14% $102.23 $111.99 $93.67 5/2/18
4/7/18 BCC $39.80 3.02% -1.95% 4.97% $41.00 $43.78 $36.62 5/2/18
4/14/18 PATK $56.65 0.00% 0.00% 0.00% $56.65 $62.32 $52.12 4/26/18

YELLOW – Target Attained