Below is a chart and brief excerpt from today's Early Look written by Hedgeye CEO Keith McCullough.
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Little known facts on Utilities (XLU) vs. “stocks” (especially those Small Cap dogs in the Russell 2000, which is -4% from its Q318 cycle peak): A) Pre-dividends, Utilities (XLU) are +34% since our process made the Full Investing Cycle pivot in Q3 of 2018B) Q419 Earning Season to-date, Utilities have an aggregate year-over- year EPS #acceleration of +15.1% Those returns and bottom-up Earnings Accelerations compare with a Sector Style of “stocks” that my process hasn’t had us long of: A) Pre-dividends (lower than Utes), Industrials (XLI) are +5.4% since we made the Full Investing Cycle pivot in Q3 of 2018B) Q419 Earnings Season to-date, Industrials have an aggregate year-over-year EPS #deceleration of -5.6% We all know what people in our profession are talking about when they say “buy stocks” because we know that they have no idea what the innovation of a new Full Cycle Investing #process entails. |
