The End Game

RIA DAILY PLAYBOOK     

FOR RELEASE ON THURSDAY, JULY 12, 2012

 

The End Game - client talking points

 

 

FRONT RUN ‘EM

Since we’re not a prop shop, bank or broker-dealer, we can say what we want. Since 2007, people have been complaining about “the machines.” Yes, we live in an era of electronic trading. If you’re sick of getting smoked by the competition, we recommend hiring brilliant people to help build machines that can front run the “other” machines. Seriously – think about it.

 

SUPER MARIO BAILOUT

Mario Monti is basically bailing on Italy and wants no part of the tidal wave of bailouts that are about to engulf the nation. Can you blame him? Politicians love this sort of short term accountability game. Italy makes Spain look like a walk in the park and will really be the country that makes headlines.

 

FLIGHT TO SAFETY

The 10-Year Treasury yield is astonishing. People cannot get enough of this thing. Yields hit a fresh new low of 1.49% this morning and that sucks for financials.

 

 

The End Game - asset allocation

 

 

The End Game - assets July11

 

 

<chart 4>

 

PSS WORLD MEDICAL (PSSI)

The bulk of the bad news is on the table following disappointing F2012. Rebased F2013 estimates far more reasonable, and revenues should be supported by our expectations for rising physician utilization, and in the near-term, a flu season that is shaping up as a considerable tailwind.

                             

TRADE: LONG

TREND: LONG

TAIL: NEUTRAL

 

HCA (HCA)

SS volume accelerated in 1Q12 and employment remains a tailwind to both admissions & mix. We expect acuity to stabilize and births and outpatient utilization to accelerate out of 1Q12, while supply cost management continues as a margin driver and acquisition opportunities remain a source for upside.

 

TRADE: NEUTRAL

TREND: LONG

TAIL: NEUTRAL

 

UNDER ARMOUR (UA)

The company continues to control its own destiny through investments in all the right areas. We think 30%+ top line and EPS growth for 5+ years. One of its failures, however, has been in penetrating markets outside the US. That will happen. But for now, its failure is a competitive advantage in the face of a strengthening dollar. We like it in sympathy with a LULU sell-off.

 

TRADE: LONG

TREND: LONG

TAIL: LONG

 

The End Game - three for the road

 

Tweet of the Day: “Can you do math? @Wolfrum Spain GDP Sept 2010 +0.4% vs -0.4% March 2012 --- Ireland GDP Sept 2010 +1% vs +1.2% March 2012 #Bloomberg”          -@Convertbond       

 

Quote of the Day: “The We do not write because we want to; we write because we have to.” –W. Somerset Maugham

 

Stat of the Day:  Greece Unemployment Rate 22.5% APR vs 21.9% MAR

 

 

 

 


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