In today’s briefing:
- Risk Pivots and Color into Late September
- GMO Q2 2022 Quarterly Letter
- Bloomberg Commodity Index Breaks 2.5-Year Uptrend; Key Indexes/Sectors Testing Support at YTD Lows
- Summers Value Partners Q2 2022 Investor Letter
- Tesla’s Q3 Ests Are Fading On Weaker China Sales—Again
- Lets Talk About LILAK
- Omnicom Group Inc: Catering To The Gaming Market & Other Developments
- RingCentral Inc: New Features For Remote Working Environment & Other Drivers
- Alteryx Inc: New Alteryx Server For FIPS & Other Drivers
- Waste Management: Recent Acquisitions & Other Drivers
Risk Pivots and Color into Late September
- Risk pivots and action points into our late September capitulation cycle with a granular look at intraday SPX, NDX and DXY wedge patterns. DJI new low leads.
- September 27/28 cycle date with a secondary timeline in early October. Need final touches into new lows for a turn signal. 27-28 capitulation that leads to a key low.
- Impulsive yield rise fits with a blow off yield move toward 4.19% projection with DXY to 115.40 and an SPX crack to a new low (3,530 once below 3,650).
GMO Q2 2022 Quarterly Letter
- Equity investors in countries with overvalued currencies have two ways to lose and those with undervalued currencies have two ways to win.
- Today’s strong USD looks, in the end, to be our currency and our problem.
- Keep an eye out for dangerously destructive economic policies, but don’t use that as an excuse to avoid the asset class entirely.
- The yen and euro are at their cheapest levels in decades and hedging emerging market equities would be an expensive proposition even if the currencies weren’t generally cheap versus the USD.
Bloomberg Commodity Index Breaks 2.5-Year Uptrend; Key Indexes/Sectors Testing Support at YTD Lows
- In last week’s Macro Vision report, we noted breaks below 3900 on the SPX and $293 on the QQQ opened the door for a test of YTD lows, or worse.
- We are now getting a test of the YTD lows of 3636 on the S&P 500 and $269 on QQQ
- With so many indexes and key Sectors currently oversold and testing support, we could certainly see a bounce/pause at current levels.
Summers Value Partners Q2 2022 Investor Letter
- Summers Value Partners is a boutique value manager that uses a focused, long-term approach to investing in areas of the market where most managers are unwilling or unable to participate.
- The Summers Value Fund LP (“the Fund”) returned -25.9% net in the first half of 2022.
- The majority of our decline took place in the first quarter as we were too slow to react to the Fed’s decision to increase interest rates and shrink its balance sheet to cool the over-heated economy.
- The next stage of the bear market will most likely involve lower corporate earnings due to a more challenging businessclimate and reducedaccess to capital.
Tesla’s Q3 Ests Are Fading On Weaker China Sales—Again
- Market consensus on Q3 deliveries has been dropping toward my ~330,000 estimate on weaker China sales, as we saw in Q2.
- This time they can’t blame Covid-shutdowns—Tesla’s production is wide open.
- Instead it looks like softer demand despite lower prices—signalling potentially more pressure ahead.
Omnicom Group Inc: Catering To The Gaming Market & Other Developments
- Omnicom’s performance in the second quarter was good as the company delivered an all-around beat.
- The company kept its attention on improving its current skills throughout the quarter to fulfill the demands of its clients and potential customers.
- In this report, we have carried out a fundamental analysis of the historical financial statements of the company.
RingCentral Inc: New Features For Remote Working Environment & Other Drivers
- RingCentral achieved good results in Q2 and delivered an all-around beat despite being impacted by the current macro climate.
- Its direct business and partners helped the company deliver an all-around beat.
- In Q2, RingCentral Rooms improved with brand-new seamless interfaces with hardware partners, including Avocor, Jabra, and EPOS.
Alteryx Inc: New Alteryx Server For FIPS & Other Drivers
- Alteryx had a strong Q2 result, exceeding Wall Street expectations in terms of both, revenues as well as earnings.
- The company reported an ARR of $727 million, up 33% year over year, and revenue of $181 million, up 50% year over year.
- The present market climate resonates with its value-driven sales approach, and sales execution is still excellent.
Waste Management: Recent Acquisitions & Other Drivers
- Waste Management had remarkable organic revenue growth, driven by a collection and disposal yield of 6.2%.
- The company continues to combat widespread inflationary cost pressures and its pricing has accelerated sequentially.
- Overall, we give Waste Management a ‘Hold’ rating with a revised target price.
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