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Market Commentary
July 14th, 2018
 

For the S&P 500 index as a whole, total Q2 earnings are expected to be up +19.1% from the same period last year on +8.2% higher revenues, with 11 of the 16 FATI sectors expected to have double-digit earnings growth.

Q2 estimates moved up modestly since the quarter got underway, in contrast to the very strong positive revisions trend we saw ahead of the start of the start of the Q1 earnings season.

For full-year 2018, total earnings for the S&P 500 index are expected to be up +20.3% on +6.2% higher revenues. For full-years 2019 and 2020, total earnings are expected to be up +9.8% and +9.6%, respectively. Revenues for the index are expected to be increase by +4.7% in 2019, and +4.5% in 2020.

The implied ‘EPS’ for the index, calculated using current 2018 P/E of 17.6X and index close, as of July 10th, is $156.51. Using the same methodology, the index ‘EPS’ works out to $171.78 for 2019 (P/E of 16X) and $188.34 for 2020 (P/E of 14.6X). The multiples for 2018, 2019 and 2020 have been calculated using the index’s total market cap and aggregate bottom-up earnings for each year.   

Featured Recommendation

Carrizo Oil & Gas, Inc.  $28.46 (CRZO)

Carrizo Oil & Gas, Inc. is a Houston-based energy company actively engaged in the exploration, development, exploitation and production of oil and natural gas primarily in proven trends in the Barnett Shale area in North Texas and along the Texas and Louisiana onshore Gulf Coast regions. Carrizo controls significant prospective acreage blocks and utilizes advanced three-D seismic techniques to identify potential oil and gas reserves and drilling opportunities.
Target Price  $31.31

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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% 10.0% 9.0% 16.0% 22.0% 3 14.0% 27.0% 16.91%
2 Small Caps 0.0% 9.0% 5.0% 14.0% 21.0% 2 13.0% 26.0% 11.29%
3 Nano Caps 0.0% 11.0% 5.0% 14.0% 16.0% 2 12.0% 27.0% 10.60%
4 Mid Caps 0.0% 5.0% 1.0% 9.0% 14.0% 1 15.0% 29.0% 5.25%
5 Large Caps 0.0% 2.0% -1.0% 6.0% 10.0% 0 15.0% 30.0% 1.77%
6 Mega Caps 1.0% 0.0% -4.0% 3.0% 9.0% 0 21.0% 26.0% -0.69%
FATI® S&G Index 2.67%

FATI® Sector Rankings

Sector 1 Mth 3 Mth 6 Mth 9 Mth 12 Mth RSR % Groups Up % Groups Dwn YTD Return
Medical 1% 14% 16% 25% 26% 5 0.0% 33.0% 22.51%
Retail/Wholesale 0% 13% 8% 25% 26% 4 0.0% 0.0% 13.93%
Consumer Discretionary 1% 8% 3% 13% 16% 2 0.0% 0.0% 6.29%
Business Services 1% 8% 1% 6% 11% 2 0.0% 0.0% 3.74%
Computer/Technology 0% 5% 2% 7% 14% 1 0.0% 42.0% 7.22%
Aerospace 1% 0% 2% 9% 22% 1 0.0% 50.0% -0.61%
Utilities 3% 1% 0% -4% 1% 1 0.0% 28.0% 1.94%
Consumer Staples 2% 1% -3% 3% 1% 0 16.0% 33.0% -3.09%
Finance 0% 2% -1% 1% 5% 0 0.0% 71.0% 5.21%
Industrial Products 0% 1% -1% 8% 13% 0 0.0% 0.0% 1.73%
Oil/Energy 3% 7% -3% 10% 13% 0 16.0% 0.0% 3.82%
Basic Materials 0% 0% -4% 10% 21% -1 0.0% 0.0% 1.81%
Multi-Conglomerates 1% 3% -6 0% 2% -1 0.0% 0.0% -3.90%
Construction 0% -1% -12% 2% 8% -2 0.0% 0.0% -7.74%
Auto/Truck -3% -3% -13% -7% 3% -3 0.0% 50.0% -6.26%
Transportation -2% -3% -12% -2% 6000% -3 50.0% 0.0% -6.48%
FATI® S/G Index 2.67%

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
Market
SPX 0 24.49 33.32 1 18.07
Mega Cap
COP 4.52 615.55 691.67 9 16.77 $84,245 10.99 20180726
EOG 2.61 368.3 477.53 12 24.02 $72,913 11.25 20180802
OXY 8.12 445.84 511.85 10 17.22 $64,049 11.25 20180801
Large Cap
FAST 2.4 32.9 44.46 10 21.54 $15,892 1.06 20181010
KMX 4.66 24.24 36.4 9 16.73 $13,581 1.55 20180928
Mid Cap
CRZO 2.92 105.85 190.97 11 9.67 $2,336 9.98 20180814
Small Cap
BMCH 1.01 46.81 70 4 14.26 $1,435 5.54 20180802
PVAC 10.14 252.54 423.96 4 8.47 $1,295 10.45 20180807

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
Market
SPX 0 24.49 33.32 1 18.07
Mid Cap
WPM -4.82 -9.52 10.91 8 38.6 $9,750 9.28 20180814
EVRG -3.02 -2.31 28.52 4 25.21 $7,952 8.97 20180814
KDP -80.23 -77.61 -73.42 3 23.85 $4,371 9.3 20180726
Small Cap
PRA -3.77 -15.84 -19.14 3 21.41 $1,951 2.94 20180807
Nano Cap
TTS -1.15 -32.81 -22.66 4 37.44 $423 9.68 20180719

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% 2.08% -10.08% $40.90 $48.91 $40.90 2/8/18
1/12/18 RGA $163.65 -8.00% 0.54% -8.54% $150.56 $180.02 $150.56 1/29/18
1/19/18 HBAN $15.81 -8.03% 0.32% -8.35% $14.54 $17.39 $14.55 1/30/18
1/26/18 AIT $74.70 -8.01% 2.49% -10.50% $68.72 $82.17 $68.72 4/26/18
2/3/18 CI $204.46 -8.00% -1.42% -6.58% $188.10 $224.91 $188.10 5/4/18
2/10/18 MTH $45.00 13.33% 6.49% 6.84% $51.00 $49.50 $41.40 4/26/18
2/17/18 NSIT $35.42 44.78% 2.47% 42.31% $51.28 $38.96 $32.59 5/2/18
2/24/18 ARCB $33.05 52.65% 1.93% 50.72% $50.45 $36.36 $30.41 5/4/18
3/3/18 CR $91.86 -8.00% -3.93% -4.07% $84.51 $101.05 $84.51 4/23/18
3/10/18 KFY $49.59 37.81% 1.58% 36.23% $68.34 $54.55 $45.62 6/19/18
3/17/18 CBPX $27.75 18.02% -1.76% 19.78% $32.75 $30.53 $25.53 5/3/18
3/24/18 CVTI $31.26 -8.00% -7.61% -0.39% $28.76 $34.39 $28.76 4/19/18
3/31/18 XPO $101.81 13.44% -3.73% 17.17% $115.49 $127.04 $93.67 5/2/18
4/7/18 BCC $39.80 23.87% -7.03% 30.90% $49.30 $43.78 $36.62 5/2/18
4/14/18 PATK $56.65 13.33% -5.18% 18.50% $64.20 $62.32 $52.12 4/26/18
4/21/18 WTFC $91.02 9.82% -4.68% 14.50% $99.96 $100.12 $83.74 7/17/18
4/28/18 KLAC $102.18 16.03% -4.69% 20.72% $118.56 $112.40 $94.01 7/26/18
5/4/18 SNDR $26.94 13.29% -4.92% 18.21% $30.52 $29.63 $24.78 8/7/18
5/11/18 BP $45.83 4.36% -2.63% 6.99% $47.83 $50.41 $42.16 8/8/18
5/18/18 CAT $155.71 3.78% -3.15% 6.94% $161.60 $171.28 $143.25 7/28/18
5/24/18 BRKS $31.88 14.34% -2.86% 17.19% $36.45 $35.07 $29.33 8/1/18
6/2/18 MOMO $49.60 9.35% -2.38% 11.74% $54.24 $54.56 $45.63 8/28/18
6/9/18 GIII $49.02 1.65% -0.80% 2.45% $49.83 $53.92 $45.10 9/5/18
6/16/18 PRG $62.36 0.00% -0.69% 0.69% $62.36 $68.60 $57.37 7/17/18
6/23/18 RDS-A $69.36 3.59% -3.01% 6.60% $71.85 $76.30 $63.81 7/26/18
6/30/18 TRTN $30.66 6.52% -2.96% 9.48% $32.66 $33.73 $28.21 8/14/18
7/7/18 CVTI $33.49 2.63% -1.48% 4.11% $34.37 $36.84 $30.81 7/24/18
7/14/18 CRZO $28.46 0.00% 0.00% 0.00% $28.46 $31.31 $26.18 8/14/18

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