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Denis Ouellet, CFA

 
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  • North American and European Bank Rankings - November 2010 [View article]
    My oldest post on this ranks banks as of May 2009 (www.news-to-use.com/20...).
    For Americans, buying Canadian provides a forex hedge against the $US!
    Canadian banks are in a great position to further expand in the US with strong valuations, balance sheets and currency.
    Nov 4 09:47 AM | Likes Like |Link to Comment
  • See THE “RULE OF 20” EQUITY VALUATION METHOD at www.news-to-use.com/20...
    Nov 2 02:14 PM | Likes Like |Link to Comment
  • ICSC Retail Store Sales: -0.8% W/W, vs. +0.4% last week. +2.4% Y/Y, vs. +3.6% last week. The decline in sales was partially due to inclement weather, and ICSC now expects monthly growth of 2.5-3%, down from previous guidance of 3%.  [View news story]
    US chain store sales declined 0.8% last week. The 4-week moving average has been falling for the 8th consecutive week. While this decline mirrors the April-May 2010 freefall, this one is worse since the poor back-to-school sales generally herald weak Christmas sales.

    The US consumer has proven pretty resilient so far, helping maintain the economy on a positive footing in 2010. But he appears exhausted. Chain store sales have essentially been flat for 6 months. Poor Christmas sales would lead to inventory liquidation by year-end and slow re-order activity into 2011, in turn impacting manufacturing activity, employment, financial markets and overall confidence levels.

    This is not bullish.

    See chart at www.news-to-use.com/20...
    Oct 5 09:08 AM | 1 Like Like |Link to Comment
  • Aug. Personal Income and Outlays: +0.5% vs. +0.3% expected, +0.2% prior. Personal spending +0.4% vs. +0.3% expected, +0.4% prior. PCE core price index +0.1% in-line with expected, +0.1% prior.  [View news story]
    Nice acceleration in Wages & salaries after the June decline. Since Transfer Receipts keep rising nearly 8% YoY (and last 3 months a.r.), and the Personal Tax rate is unchanged, Personal Disposable Income is up 3.2% YoY, its best showing since March. Personal income in August was boosted by the resumption of extended and emergency unemployment benefits. The social safety net is doing its job pending the still elusive resumption of employment growth…

    However, comps will be getting more challenging by November unless labor income gets a quick boost from employment.

    The Savings Rate has been between 5.7% and 6.0% since April same as last November and December. Will consumers “dissave” some to increase consumption during the important Christmas season. Based on back-to-school sales, the opposite seems to be happening. But now that the stock market is rising, there may be a just-in-time wealth effect.

    See charts at www.news-to-use.com/20...
    Oct 1 11:07 AM | Likes Like |Link to Comment
  • Gold Jewelry Demand Keeps Falling. Buyers Beware [View article]
    On the seasonality of gold and gold shares, see www.news-to-use.com/20...
    Aug 27 10:46 AM | Likes Like |Link to Comment
  • Gold Jewelry Demand Keeps Falling. Buyers Beware [View article]
    Charles, you see the point. The last time we saw a rotation from "usables" to "investables" was in the housing market...
    Aug 26 01:00 PM | 4 Likes Like |Link to Comment
  • ICSC Retail Store Sales: -0.4% W/W, vs. -1.3% last week. +2.3% Y/Y, vs. +3.3% last week. The fourth straight weekly decline was due to general economic weakness and hot weather that curbed the demand for both fall goods and back-to-school apparel.  [View news story]
    I do the yoy ch in the 4wk m.a.. Most recent +3.3%, down from 3.0% 2 wks ago and +4.8% end of April 2010.
    Aug 24 09:08 AM | Likes Like |Link to Comment
  • ICSC Retail Store Sales: -0.4% W/W, vs. -1.3% last week. +2.3% Y/Y, vs. +3.3% last week. The fourth straight weekly decline was due to general economic weakness and hot weather that curbed the demand for both fall goods and back-to-school apparel.  [View news story]
    These were last week's figures. For the week ending Aug 21: -0.4%. August -1.9% month to date. Pretty bad. See chart at www.news-to-use.com/20...
    Aug 24 08:13 AM | 2 Likes Like |Link to Comment
  • ICSC Retail Store Sales: -1.3% W/W, vs. -0.2% last week. +3.3% Y/Y, vs. 3.7% last week. Weak pricing led to the third straight weekly decline for same-store sales though store traffic was steady.  [View news story]
    After a strong Q2 earnings season, the US back-to school season starts poorly, dampening investors expectations for continued strong earnings growth in the second half. Chain store sales dropped 1.3% last week, the third consecutive weekly decline. The 4-week moving average has now dipped down, just about where it last peaked out in early May. Back-to-school sales generally set the stage for Christmas. So far, the trend is not good.

    ChangeWaveResearch polled US consumers about a month ago on their spending intentions over the next 90 days, essentially the back-to-school season.

    One-in-three respondents (32%) say they’ll spend less over the next 90 days than they did a year ago – 6-pts worse than in our June survey. Just 30% say they’ll spend more – down 8-pts from previously.
    See charts and more at www.news-to-use.com/20...
    Aug 17 08:20 AM | Likes Like |Link to Comment
  • U.S. Equities Are Clearly Undervalued: Crunching the Numbers [View article]
    For the record, the PE range of the S&P 500 Index during the 1970's was 6.7-19.8x with a 12.3x avg and an 11.2 median (monthly data). If we only look at the Sept 1974 to Dec 1979 low PE period, the range was 6.7-12.0x with a 9.3x avg and a 9.0x median.

    As you certainly remember, inflation was all over the map during the 1970's ranging between 3% in 1972 and 14% in late 1979. PEs trended with an almost perfect inverse correlation with inflation, the exact point of the Rule of 20.

    During the first half of the 1970's the Rule of 20 never showed strong equities undervaluation, initially because actual PEs were high and later because inflation was rising very rapidly. It is only during 1976-77 that the Rule of 20 was indicating strong undervaluation.
    Jul 27 02:12 PM | 2 Likes Like |Link to Comment
  • ICSC Retail Store Sales: -0.5% W/W, vs. -0.7% last week. +2.5% Y/Y, vs. +2.9% last week. Even after two weeks of weakness in sales, ICSC expects the rate to rise to 3-4% for the full month of June.  [View news story]
    This was last week. Sales actually jumped 2.1% during the week ended June 26. See the chart at www.news-to-use.com/20...
    Jun 29 09:36 AM | Likes Like |Link to Comment
  • May Retail Sales: -1.2% vs. +0.2% expected, +0.6% (revised from +0.4%) in April. Ex-auto -1.1% vs. -0.1% expected, +0.4% prior.  [View news story]
    US retail sales declined 1.2% In May from April, after 8 months of uninterrupted growth totaling 8.5% annualized. The damage was mainly in auto and housing related sales.

    Motor vehicle sales declined 1.7% while gas station sales dropped 3.3% on a 6.3% decline in prices.
    Total sales ex cars, gas and food stores retreated 1.0%, led by building material stores where sales dived 9.4%.

    Department Store Type Merchandise retailers were flat.

    Online retailers continued to gain share as their sales rose 2.0%.

    See charts at www.news-to-use.com/20...
    Jun 11 09:46 AM | Likes Like |Link to Comment
  • ICSC Retail Store Sales: -0.4% W/W, vs. +0.2% last week. +4.4% Y/Y, vs. +5.5% last week.  [View news story]
    Weekly chain store sales declined 0.4% last week but finished the month of April up 2.1% from March, a strong showing given that Easter was April 4. The 4-week moving average is up 4.7% over last year.
    See chart at www.news-to-use.com/20...
    May 4 08:35 AM | 1 Like Like |Link to Comment
  • ICSC Retail Store Sales: +0.2% W/W, vs. +0.1% last week. +4.6% Y/Y, vs. +4% last week. Warm weather helped drive traffic to department stores and apparel retailers.  [View news story]
    Sales rose 0.2% last week, showing no let down after Easter. The 4-week moving average is up 4.2% YoY when sales had recovered some from the January crater. Year-to-date, ICSC chain store sales are up 3.4% or 11.8% annualized!
    See chart at www.news-to-use.com/20...
    Apr 20 08:04 AM | Likes Like |Link to Comment
  • ICSC Retail Store Sales: +0.1% W/W, vs. +2.1% last week. +4.0% Y/Y, vs. +4.7% last week. April will prove to be key for retail sales as an early Easter pulled sales into March.  [View news story]
    Fears that sales would weaken after Easter did not materialize. Chain store sales were up 0.1% last week (ended Apr. 10) and the 4-week moving average is now +3.9% YoY. The crater effect is not very big as April was a relatively strong month last year.
    See chart at www.news-to-use.com/20...
    Apr 13 08:43 AM | Likes Like |Link to Comment
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