Tax Reform
Capex Beneficiaries “Delivered,” But Only On Price Action
With optimistic views on capex in late 2017, we built a thematic group of companies that appeared to be potential beneficiaries of higher spending going forward. This group has outperformed the market; but, the capex trend is disappointing and quite concerning.
So Long Tax Cuts… We Hardly Knew Ye
Our earnings waterfall analysis for the fourth quarter tells a story consistent with the entirety of 2018: earnings growth was fantastic, boosted by the twin drivers of strong sales growth and a lower corporate tax rate. Chart 1 spotlights the quarter’s tally, which produced a healthy sales growth number despite some economic weakening.
Cycles And Taxes And GICS, Oh My!
Analyzing quarterly financial results and developing insights about upcoming periods is always difficult, but the first quarter of 2018 was unusually complicated.
Musings On Margins
Fourth quarter earnings were the last ones to be burdened by a 35% top marginal corporate income tax rate, and therefore seem to have been given a pass by the analyst community.
Multiple Contraction—Just A Little Patience?
Things were bigger when you were a kid. Like that enormous sweatshirt your aunt gave you for your birthday or that hand-me-down ten-speed bike with the cross bar taller than your shoulders.
Tax Reform Hits Factor-Land
Apparently tax reform wasn’t priced in.
Impact Of Lower Corporate Tax Rate
A stock market wild card in 2017 is the potential for a significant reduction in the corporate tax rate. President-elect Trump’s desire to lower corporate taxes, if implemented, would have multifaceted impacts on businesses.
Client Questions
Here again are some of the client queries we have had over the last month or so.
View from the North Country
Australian Bond Update…TV Isn’t All Bad…Tax Reform…How’s Your Long-Term Investment Perspective? Take the Quiz…How to Make Over 50% On Your Money and Lose
View from the North Country
Back to the Basics? We think individual stock analysis is becoming increasingly important… Tax Simplification Coming Soon: The 1984 additions to the tax laws (over 1300 pages) may be the last straw… A Potential Shortage in Treasury Bonds: I know this sounds absurd. However, in the upcoming financing, the Treasury is for the first time offering a 20-year bond that is callable in five years.
View from the North Country
A recent visit to Washington D.C. prompts some thoughts concerning the insularity of the city and the unresponsiveness of government and politicians to the wants and desires of the electorate. The apparent lack of political interest in the flat tax is an excellent, timely example of this.
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