Northlake’s Market Cap model shifted from large cap to a weak mid cap signal for May. We are using discretion and waiting to make the change in client portfolios given the ongoing market volatility and uncertainty about progress of reopening the economy while containing the pandemic. Moving to mid cap adds a higher risk, higher […]
Comcast’s 1Q20 earnings report and conference call exposed sharp differences of how the COVID crisis is impacting the company’s three business segments. Already positive trends in the core cable business are getting a boost. NBC Universal and Sky, however, are in the direct path of the virus with little visibility for the pace or timing […]
Northlake’s investment thesis on IBM centers upon the gradual transition to faster revenue growth as cloud services become a greater part of IBM’s revenue mix. Prior to the COVID crisis, we got an unexpected boost from a CEO transition that elevated the head of company’s cloud efforts. The economic shutdown clearly will impact IBM as […]
Alphabet (GOOG/GOOGL) reported 1Q20 earnings that indicated better than expected results in January and February before the economic shutdown, offset by a sharp but not quite as bad as expected slowdown in March. The company commented that advertising trends at Search and YouTube have stabilized in April with signs of green shoots. Emerging businesses like […]
Northlake’s Market Cap model shifted from mid cap to large cap, primarily reflecting the history of large caps holding up better during bear markets. The Style model is sticking with growth which makes sense given growth companies are less sensitive to the cyclical impact of recessions. We swapped remaining client positions in mid cap to […]
There are no changes to the recommendations from Northlake’s models for March. The Market Cap model remains on a mid cap signal and the Style model is still recommending growth. There will be no changes to client positions following the models and currently invested in the S&P 400 Mid Cap (MDY), the Russell 1000 Growth […]
Nexstar Media Group reported excellent 4Q19 results and raised its guidance for 2020/2021 average annual free cash flow by 15%. In a normal market this news would have been greeted by a sharp rise in the stock price, arguably up 5-10% or more. Alas, Nexstar reported right into the teeth of the market sell-off on […]
ViacomCBS (VIAC) reported more disappointing news with its 4Q19 earnings report and 2020 guidance. The stock is now down about -40% since last summer when the company first lowered its outlook. Investors had thought that management had given a conservative outlook back then but this appears to have not been the case. Management credibility is […]
In our last blog post on MGM Resorts (MGM), we note that after a string of tough quarters brought about mostly due to things beyond MGM’s control, the story was moving in the right direction. Bad luck has struck again and not just with hold in the casinos. The coronavirus has shut down Macau and […]
Disney (DIS) is a difficult stock to value at the moment as the company is “all in” on the roll out of Disney+ and overall transition of its traditional media revenue sources to streaming. The new streaming services are losing money now and likely will for another few years. The traditional media businesses including ESPN […]
