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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 - 10/29/2021

by Hodges Investment Team, on Oct 29, 2021 9:00:00 AM

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

#1 WINDOW VISIBILITY: A recent homebuilder survey conducted by John Burns Real Estate Consulting cited that windows are the most significant material shortages causing project delays. With 63% of builders identifying windows as their largest challenge, average lead times range from 4-15 weeks. Before the pandemic, lead times were typically 2-3 weeks.    

#2 ANCHORS AWAY: Recent reports from a leading national boat retailer have suggested that boat demand remains strong relative to supply. Furthermore, the supply of new recreational boats is unlikely to improve until late 2022.  

#3 GREEN STEEL PRODUCTION: According to data provided by Worldsteel, 42% of US flat-rolled steel production now utilizes electric arc furnaces (EAF) compared to 1% in 1990. EAF steel production has increased the demand for prime grade scrap metal mainly produced from manufacturing and has seen a decline in supply in recent years.

#4 MATTRESS RETAIL: After a strong Labor Day sale period for the mattress industry, recent Google search volume for most mattress brands has slowed over the past month. However, search results remain elevated for one of the leading premium mattress brands, suggesting a recent possible market share shift.

#5 APPLIANCE CYCLE: With an installed base on connected appliances becoming more prevalent, a leading North American appliance manufacturer has recently indicated that its data suggests that consumers are using appliances such as wall ovens, freestanding ranges, and washing machines far more often than before the pandemic. Elevated usage of appliances could ultimately drive shorter replacement cycles.

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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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