IBM reported a positive surprise in revenue and earnings per share for its 1Q21, an unusual occurrence over the last several years. Revenue of $17.7 billion was about $300 million ahead of consensus and guidance, the first beat on this metric since 2018. Gross margins, another trouble spot of late, also came in ahead of […]
We are moving from neutral on growth vs. value to all-in on value effective today. We are sticking with mid cap. As a result, for clients using Northlake’s thematic models, we have sold all client positions in the Russell 1000 Growth (IWF) and reinvested the proceeds into the Russell 1000 Value (IWD). There will be […]
Northlake is swapping out of purely small cap exposure, moving half to mid cap and half to large cap. The large cap is coming from Style exposure as we stay neutral on growth vs. value but move from small cap to large cap ETFs. In Market Cap, the swap is from small cap to mid […]
Interest rates on bonds maturing more than a year in the future have risen since our last update on income equities. At the end of November, the 10-year US Treasury bond yield was a little less than 1.00%. Today, the yield is about 1.45%. Short-term interest rates that are fully controlled by the Federal Reserve […]
Home Depot reported better than expected EPS, sales, and comp store sales, but had a small margin shortfall. The stock has reacted poorly to the results, but we remain bullish on the outlook. HD shares are unchanged since last summer even as quarterly earnings have consistently grown at 20%. This has led to a material […]
Nexstar Media Group (NXST) reported better than expected 4Q20 results despite elevated expectations. More importantly, guidance for free cash flow in the 2021/2022 cycle came in way above estimates. The 21/22 outlook validates the strategy that NXST has followed since we first became familiar with the company back in 2013. NXST management has steadily built […]
Disney (DIS) reported its first quarter under its new reporting structure which is designed to isolate the company’s three main businesses and especially highlights the Direct-To-Consumer (DTC) streaming businesses that are the future of the company’s media businesses. Results in the company’s 1Q21 were better than guidance and analyst expectations but are not a short-term […]
Activision Blizzard (ATVI) reported 4Q20 results roughly in line with Wall Street estimates that were above the company’s own guidance. More importantly, management provided initial 2021 guidance that was above analyst estimates and appears to be based on conservative assumptions. ATVI shares have been fantastic performers for Northlake over the years and had a particularly […]
Sony (SNE) provided a great boost to our investment thesis with the company’s 3Q20 earnings results. Earnings easily beat Wall Street estimates with strength in almost all segments. Gaming and Image Sensors led the way. Gaming got a boost from the rollout of the PS5 console, popular new games, and continuing subscription growth. Image Sensors […]
Alphabet (GOOG/GOOGL) reported excellent 4Q20 results across the board in all segments and on all financial metrics. Revenue, EPS, Operating income and profit margins each easily and materially beat Wall Street estimates. These factors alone are worth a nice boost in GOOG/GOOGL shares. However, the company also took another meaningful step to improve financial disclosure […]
