DM Monthly Report – April 2024
WILL THE MARKET’S CONCENTRATION BE ITS UNDOING?
Though virtually all of our equity analysis occurs at the company level, it’s been hard to ignore the recent warnings about market structure, and in particular the dominance of the Magnificent 7 group of mega-cap stocks in the S&P 500.
FEATURE STOCK – Ametek Inc. (AME)
In February, we initiated a new position in AME and subsequently added to the holding in mid-March. AME is a leading global manufacturer of niche components, analytical instruments, and precision automation devices for use in aerospace, power, defense, and other industrial segments.
Click here to read more: DM Monthly Report – April 2024
DM Portfolio Commentary – Q1 2024
Where were you four years ago? Just kidding, we know where you were. If you weren’t pacing empty aisles in search of a forgotten bundle of toilet paper, or trying your hand at cutting hair, or making calls to get out of the summer vacation you’d booked the month before, you were undoubtedly sitting at home like everyone else. Regardless, you were living a life that you couldn’t have envisioned just weeks earlier, with little sense of how or when thing would get back to how they’re supposed to be.
The covid-19 outbreak also threw financial markets into a state of disarray, just like the subprime crisis had done barely a decade earlier, with stocks falling sharply against a relentless stream of disconcerting news. Equipped with lessons from the last financial calamity, however, policy makers acted with unmatched swiftness and force to dampen the effects of the pandemic, and soon we found ourselves living in an odd, suspended economic reality.
Click here to read more: DM Portfolio Commentary – Q1 2024
DM Monthly Report – Feb 2024
STOCKS MAKE NEW HIGHS, CASH BUILD CONTINUES – In our final quarterly report for 2023, we noted that alongside the equity market’s prodigious rally, balances in short-term vehicles had swollen to unprecedented levels. In the first two weeks of 2024, $182 billion channeled into US money-market funds, surpassing the previous record inflow for that period by over 50%, and the S&P 500 continued its winning ways, with a January gain of 1.5%, lifting the index to an all time high.
FEATURE STOCK – Netflix (NFLX) – For the Q4-23 reporting season, earnings posted by the “Magnificent 7” group of stocks ranged from solid to spectacular, helping to propel the S&P 500 to new heights and confirming that, for the most part, these companies are generating the growth to support their valuations.
Click here to read more: DM Monthly Report – Feb 2024
DM Q4 Portfolio Commentary
Cash is for spending – In investment parlance, “cash” refers not to the notes and coins in your wallet, but to any certificate of deposit, treasury bill, or other interest-bearing vehicle with a maturity of one year or less. Prior to autumn 2022, such instruments paid so little that they attracted almost no attention from anyone with funds to deploy. That changed abruptly, however, when central bankers around the world launched aggressive rate hiking programs to blunt surging inflation and, just like that, cash was in vogue.
Click here to read more: DM Portfolio Commentary – Q4 2023
