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Hodges Friday Fast Five

"In the investment business, you go to school every day, but never graduate." - Don Hodges

Friday Fast Five - 10/22/2021

by Hodges Investment Team, on Oct 22, 2021 8:16:35 PM

Five interesting things that Hodges Capital research analysts discovered this week...

#1 CAPITALISM IN TROUBLE: According to a recent Axios/Momentive survey of Americans 18-34 years old, 49% have a favorable view of capitalism, and 46% view it negatively. More specifically, for those younger adults between 18-24, only 42% have a positive view, and 54% have a negative view.
#2 EARNINGS EXPECTATIONS: The third-quarter earnings season is now underway. Factset data suggest that S&P 500 earnings are expected to be up 24.4% year-over-year, with 9 out of its 11 sectors expected to grow. Forward earnings guidance will likely see headwinds from higher commodity pieces, labor shortages, and increased transportation costs.

#3 FORECLOSURES: As government and private sector programs designed to help mitigate pandemic-related disruptions begin to expire, foreclosures are on the rise. CNBC reported that Mortgage lenders had started the foreclosure process on more than 25,000 properties in the recent quarter, a 67% year-over-year increase.

#4 NO VACANCY: The U.S. rent inflation was up by 0.5% in September from the previous month and appears to have momentum to the upside, according to Strategas. Higher rent has primarily been driven by a lack of new supply in 2021.

#5 CEO QUOTE: Mark Millett- Steel Dynamics, CEO & President, stated this week, “The pent-up demand is absolutely there…. in the automotive arena. And in my humble opinion, when the chip shortage relieves itself, all they're going to do is just ramp up and maximize the output for the next couple of years because there's that much demand.”

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Hodges Private Client is a program offered through Hodges Capital Management, Inc. (“HCM”). HCM is an Investment Advisory Firm registered with the Securities and Exchange Commission (“SEC”), is a wholly owned subsidiary of Hodges Capital Holdings and serves as investment advisor to the Hodges Funds. HCM is affiliated with First Dallas Securities, Inc, a broker-dealer, and investment advisor registered with the SEC.

This discussion is not intended to be a forecast of future events and should not be considered a recommendation to buy or sell any security. Past performance is not indicative of future results. Investing involves risk. Principal loss is possible. Investing in smaller companies involves additional risks such as limited liquidity and greater volatility. No current or prospective client should assume that information referenced in this communication is a recommendation to buy or sell any security or is a substitute for personalized investment advice from your individual advisor. HCM does not provide tax or legal advice. Consult your tax or legal advisor for any related questions.

All information referenced herein is from sources believed to be reliable and is provided as general market commentary and does not constitute investment advice. This material was created for informational purposes only and the opinions expressed are solely those of HCM. HCM shall not in any way be liable for claims and makes no expressed or implied representations or warranties as to the accuracy or completeness of the data and other information. The data and information are provided as of the date referenced and are subject to change without notice.

Hodges Friday Fast Five

We aim to help investors separate the news from the noise by providing our perspective. Every Friday the Hodges Private Client research analysts list the five most interesting things they discovered that week. Subscribe to receive the Hodges Friday Fast Five in your inbox every Friday. 

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