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A Takeaway From Our Institutional Call on Agrium | $AGU

Takeaway: Shares of Agrium have remained comparatively resilient in 2016, a trend which we expect to reverse in 2H16.

A Takeaway From Our Institutional Call on Agrium | $AGU - agu present 

 

Hedgeye analysts Jay Van Sciver and Ben Ryan hosted an institutional call on Agrium (AGU) earlier this week. Here's the key takeaway:

 

Shares of Agrium have remained comparatively resilient in 2016, a trend which we expect to reverse in 2H16. As Agrium enters the back half of the year, wholesale margins are likely to see pressure amid lower fertilizer prices and higher input costs. While 1H16 retail margins benefited from early spring 2016 season planting and delayed fall 2015 nutrient application, such support should fade in 2H.

 

A Takeaway From Our Institutional Call on Agrium | $AGU - agu chart

 

KEY topics of discussion:

  • Broader Consideration of Retail Cyclicality: Product pricing, margins, and customer credit
  • Fertilizer Prices vs. Input Costs: Nitrogen set-up for 2H16 margin pressure
  • Capacity Growth & Exports: Chinese export trends, additional North American capacity
  • Retail Supplier Consolidation: Merger activity and trends in supplier concentration over time
  • Capital Allocation: Consideration of Agrium's redeployment of cycle peak profits
  • Valuation vs. Cycle: Valuations outside of Ag boom for retail, wholesale; where we expect Agrium shares to trade.

 

To access our institutional research email sales@hedgeye.com.


A Closer Look At European #GrowthSlowing

Takeaway: European equities continue to fall as the #GrowthSlowing data continues to roll in.

A Closer Look At European #GrowthSlowing - economic indicators cartoon 02.24.2016

 

Below is analysis from Hedgeye CEO Keith McCullough in a note sent to subscribers earlier today: 

 

"One way to keep US Equity Beta Up = Dollar Down (on the week); but how does that continue (from here)? With GBP/USD signaling immediate-term TRADE overbought at $1.34 and US economic growth (Q2 GDP) not tracking to recession (our Q2 predictive tracking algo currently has 1.5-1.8% y/y)?

 

The other side of the FX (and relative economic slowing) TREND looks like Euro Down (vs. Dollar Up) to me; EUR/USD top-end of the risk range = $1.12, and as European #GrowthSlowing continues I’m looking for a re-test of $1.05; French stocks down -0.8% have the CAC40 out of “crash” mode at -17% from last year’s high, but still bearish TREND @Hedgeye."

 

Take a look at the chart below of tumbling European equity markets:

 

Why such dismal performance?

 

Europe's #GrowthSlowing data continues to roll in...

 


Daily Market Data Dump: Friday

Takeaway: A closer look at global macro market developments.

Editor's Note: Below are complimentary charts highlighting global equity market developments, S&P 500 sector performance, volume on U.S. stock exchanges, rates and bond spreads, and key currency crosses. It's on the house. For more information on how Hedgeye can help you better understand the markets and economy (and stay ahead of consensus) check out our array of investing products

 

CLICK TO ENLARGE

 

Daily Market Data Dump: Friday - equity markets 7 15

 

Daily Market Data Dump: Friday - sector performance 7 15

 

Daily Market Data Dump: Friday - volume 7 15

 

Daily Market Data Dump: Friday - rates and spreads 7 15

 

Daily Market Data Dump: Friday - currencies 7 15


Early Look

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Relied upon by big institutional and individual investors across the world, this granular morning newsletter distills the latest and most vital market developments and insures that you are always in the know.

[UNLOCKED] Keith's Daily Trading Ranges

We've made some new enhancements to Daily Trading Ranges - our proprietary buy and sell levels on major markets, commodities and currencies sent to subscribers weekday mornings by CEO Keith McCullough. Click here to view a brief video of McCullough explaining how to use it most effectively.

 

Subscribers now receive risk ranges for 20 tickers each day -  the last five of which are determined by what's flashing on Keith's screen and by what names subscribers are asking about. Click here to subscribe.

 

  • Bullish Trend
  • Bearish Trend
  • Neutral

INDEX BUY TRADE SELL TRADE PREV. CLOSE
UST10Y
10-Year U.S. Treasury Yield
1.56 1.31 1.53
SPX
S&P 500
2,101 2,177 2,163
RUT
Russell 2000
1,202 1,225 1,202
COMPQ
NASDAQ Composite
4,850 5,090 5,034
NIKK
Nikkei 225 Index
14,919 16,590 16,385
DAX
German DAX Composite
9,269 10,105 10,068
VIX
Volatility Index
12.24 18.32 12.82
USD
U.S. Dollar Index
95.28 96.92 96.10
EURUSD
Euro
1.09 1.12 1.10
USDJPY
Japanese Yen
100.28 106.29 105.44
WTIC
Light Crude Oil Spot Price
43.09 47.04 45.50
NATGAS
Natural Gas Spot Price
2.61 2.95 2.73
GOLD
Gold Spot Price
1,315 1,378 1,335
COPPER
Copper Spot Price
2.08 2.28 2.24
AAPL
Apple Inc.
94.52 98.99 98.79
AMZN
Amazon.com Inc.
720 761 741
NFLX
Netflix Inc.
90.83 99.14 98.02
GOOGL
Alphabet Inc.
691 745 735
JPM
J.P. Morgan Chase & Co.
58.40 64.89 64.12
INFY
Infosys Tech.
17.05 18.46 18.44


CHART OF THE DAY: China's $704,000,000,000 Debt Binge

Editor's Note: Below is a brief excerpt and chart from today's Early Look written by Hedgeye U.S. Macro analyst Christian Drake. Click here to learn more.

 

"... 4. Chinese Debt: Credit growth and proclivity for malinvestment in China is well publicized but I still think loan growth in 1Q was underappreciated. New loan growth in China was a remarkable $704B in 1Q16. To put that in context, the ARRA Act of 2009 (i.e. Peak Crisis, U.S. Recession Stimulus Package) was just north of $800B. What did that buy them? – another lower cycle low in GDP for 1Q."

 

CHART OF THE DAY: China's $704,000,000,000 Debt Binge - CoD 4


Cartoon of the Day: Beta Bro

Cartoon of the Day: Beta Bro - Beta Bro cartoon 07.14.2016

 

We present to you "Beta Bro." The defender of mediocrity in the active management community and all things S&P 500 beta.


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This indispensable trading tool is based on a risk management signaling process Hedgeye CEO Keith McCullough developed during his years as a hedge fund manager and continues to refine. Nearly every trading day, you’ll receive Keith’s latest signals - buy, sell, short or cover.

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