Seeking Alpha

Oppenheimer, Strategas offer opposing views on materials stocks

  • Oppenheimer analysts are believers in the materials sector, citing increasing evidence that the global economy is modestly improving from its recent lethargic pace of growth, particularly in emerging markets.
  • Strategas isn't so sure; despite some stronger equity performance in recent weeks, it sees the persistence of cyclical weakness in emerging economies and the apparent forming of a structural consolidation in global commodities complex; it favors companies with a higher domestic revenue profile over those with a broader global footprint.
  • Vulcan Materials (VMC) gets just 1% of its revenue overseas, while Airgas (ARG) has just 2%; those least exposed to the U.S. economy include Newmont Mining (NEM), which gets all of its revenue abroad, and International Flavors (IFF) and Owens-Illinois (OI), which each get 23%-24% of sales at home.
  • ETFs: XLB, XME, EMT, PICK, JUNR. MSXX.
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