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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 - 3/4/2022

by Hodges Investment Team, on Mar 4, 2022 9:00:00 AM

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

#1 ANOTHER STRONG QUARTER: The fourth-quarter reporting season wrapped up last week for the S&P 500, which turned out to be another strong quarter. According to an analysis provided by Strategas, earnings growth came in north of 30% and revenue growth approached 15%.  

#2 THE MAGIC NUMBER: “The magic number is 90%. When oil prices go up 90% over a 10-to-12-month period, the U.S. has a recession,” according to Nicholas Colas, co-founder of DataTrek Research. West Texas Intermediate (WTI) crude oil prices are up approximately 75% year-over-year.

#3 ULTRA-WEALTHY: The number of Ultra-High-Worth Individuals, those with $30 million or more in net assets, grew 9.3% to 610,568 last year, according to an analysis by Knight Frank. North America led the charge, growing 11.2% to 233,590 Ultra-High-Worth Individuals.

#4 HOUSING DEMAND: “One fact I’d like to remind you of is that there are currently more single-family homes under construction across the country than there have been in more than 14 years, and the homebuilder backlog is currently at the highest level it’s been in the last 15 years. Backlogs, in fact, were an estimated 145,000 single-family units authorized but not yet started as of last month, up 32% year-over-year, an encouraging sign of continued demand strength.” – David Flitman, CEO of Builders FirstSource

#5 MACRO HEADWINDS: “For the first half of 2021, the macro environment was a tailwind with government relief programs pushing expenditures on consumer durables and favorable payment behavior to levels that were above historical averages. In the latter portion of the year, the macro environment shifted to a headwind. Government pandemic relief programs that have supported higher rates of consumer spending ended, and in addition, supply chain disruptions and a significant uptick in inflation, diminished consumers’ ability to access and afford products.” – Mitchell Fadel, CEO of Rent-A-Center  


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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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