Recent Commentary

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May 26, 2016

An Atypical Analysis of Industry Risks

Most investors focus on tangible income statement and balance sheet items, but intangible factors can be material too.

mirexon
May 2, 2016

Regional and Sector Strategy: Monthly Update

Our earnings momentum metric has been refined. In addition, we have also introduced a methodology for weighting ESG factors in sectors and regions. These modifications have resulted in an unusually large number of changes in recommendations.

Weight Scale Balance Comparison Stone Scale Winning Weight
April 7, 2016

Global Equity Strategy: Have You Put On Weight?

There is no consensus about the weight to be given to ESG factors in investment decisions. We have taken a first step in addressing this issue.

mirexon
April 4, 2016

Regional and Sector Strategy: Monthly Update

Energy and materials are still sinking; Japan at some risk of becoming a “value trap”; ESG weightings affect our views on Russia and US.

Background image with financial charts and graphs on the table. Elements of this image are furnished by NASA
March 1, 2016

Global Earnings Synthesis: On Track for Modest Gains in 2016

Building on the recent analysis in our Regional and Sector Strategy: Monthly Update, we continue to embrace an outlook for just a single-digit increase in profits in 2016, which is in contrast to consensus estimates that imply a 21% gain in earnings.

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March 1, 2016

Regional and Sector Strategy: Monthly Update

We remain Overweight Information Technology (largest weighting in Overweight North America region) and Consumer Discretionary (largest weighting in Japan, our other Overweight). We continue to avoid regions with heavy exposure to commodities, most notably Latin America (Underweight), South Africa and Russia (both ranked Neutral).

close up shot of world map on blue background
February 22, 2016

Country Valuation: An ESG Synthesis

Effective national governance (“G”) facilitates a country’s efficient transformation of environmental resources (“E”) into wealth. Both are strongly influenced by social factors (“S”). By way of example, France’s social objective of maintaining a rural economy necessitates heavy government intervention and likely detracts from its potential for economic development.

the entrance to the supreme court
February 10, 2016

Supreme Court Ruling Highlights Clean Power Plan’s Potential

On February 9, 2016, the US Supreme Court (SCOTUS) granted a stay to the implementation of the CPP rule by the US Environmental Protection Agency (EPA). In our view, the intensity of the challenge from the states and certain industries, and the SCOTUS ruling that CPP should be halted while being litigated, demonstrates that the CPP has significant implications for the sector.

Background image with financial charts and graphs on the table. Elements of this image are furnished by NASA
February 1, 2016

Regional and Sector Strategy: Monthly Update

We downgrade Financials to Neutral from Overweight. The combination of plunging earnings momentum and deteriorating valuation has significantly reduced the attractiveness of the Financials sector.

A group of baby chicks, standing under a warming light on a farm.
February 1, 2016

Tracking our Thesis on Nutritional Feed Additives

As we discussed in our October 5, 2015 report Antibiotics and Animal Health: Value-Chain Implications in the US, a confluence of regulatory action and heightened consumer awareness is exerting pressure on livestock producers to reassess their usage of antibiotics. Our optimistic view on specialty and nutritional feed additives is supported by Adisseo and Novozymes’ recent launch of a probiotics product.