For those tracking my Partner Keith’s macro work, you know that he’s taken the Hedgeye Portfolio (sadly) to 96% cash. What little long exposure we like here at Research Edge is geared towards yield. In that vein, I ran a screen starting over a group of 447 global textile, apparel, and footwear brands, retailers, and sourcing companies I in search of yield.
Not much hope… The first point worth noting is that the first US company on the list (Blythe) was number 64 on the list with a yield of 4.1%. No other US company over 4%. The average non-US company, however, was 6.3%. Yes, there are differences in risk profile associated with small public companies in third world countries that throw off this comparison to some extent. But even relative to both historical and US equity market standards, this space is not particularly cheap on a yield basis.
Not much hope… The first point worth noting is that the first US company on the list (Blythe) was number 64 on the list with a yield of 4.1%. No other US company over 4%. The average non-US company, however, was 6.3%. Yes, there are differences in risk profile associated with small public companies in third world countries that throw off this comparison to some extent. But even relative to both historical and US equity market standards, this space is not particularly cheap on a yield basis.
