Merger Consideration Brief (3rd Quarter 2017)
The MAB Factor is based on a simple premise; if companies have extremely high market relative valuation scores respective to their sector counterparts, they have a higher probability to be seeking acquisitions (Hunters). They will take advantage of the premium within their stock price and acquire other less relatively valued companies. Companies with valuations that are lower relative to their sector counterparts have a higher probability of being acquired (Hunted).
USA Snap-Shot
Several months ago we were pleased that the DOW closed above 21,000, now we can be even more pleased that it is potentially closing above 22,000 this evening. As I write this brief the DOW is just a few points above 22,000. I also remember when we published our annual market forecast at the beginning of the year when we stated the market had the potential to reach 22,232 and would most likely reach 21, 173. Many said we were unrealistic; it was too high
Update USA Asset Allocation
Information Technology remains the most important sector throughout each of the classifications ranging from 2.0% in the Stable allocation increasing to 18.2% a 0.4% increase over last month in the Opportunity allocation. Increase in allocation have been assigned to Financials, Healthcare, Industrials, Technology, Materials and Utilities. Reductions have been assigned Consumer Discretion, Consumer Staples and Energy.
Update Economic USA Personal Income
Personal income increased a very light $3.5 billion in June which was only 5% of the previous month gain of $67.1 billion. The rate of increase in personal income has been in decline since November 2014. It is still expanding in absolute terms, but at a lower rate of expansion. We know, the longer an expansion takes place, the more difficult a higher rate becomes. Personal income must continue to increase for an expanding economy.
USA Stock Consideration Change Report
American Axle, Helmerich & Payne, Omega Healthcare and Pitney Bowes all move to