Singular Research Director’s Letter : August 2018

An Unheralded Record

Singular list tops S&P 500 but lags Russell 2000 in August.


SINGULAR MONTHLY PERFORMANCE STATISTICS

 

Last Month

YTD

Trailing 12 Mo’s

SINGULAR LIST

2.88%

2.83%

10.45%

S&P 500

2.69%

7.59%

16.38%

RUSSELL 2000

3.75%

11.89%

22.26%

 

 

 

 

 

 



Meanwhile, the S&P 500 set a record for duration of a bull market exceeding 10 years. In August, measured from its lows at 666 this represents an eye-popping 330 % return.
However, if you were among the unfortunate whom invested in the tech bubble in the year 2000 when the S&P 500 floated at the 1500 level your returns are a much less impressive + 90%. Or a price appreciation of about 4% per year.

Despite near-record optimism and employment on top of a record bull market, professional money managers believe this is the peak. More than 58% of them believe that 2019 will be a down year. 
Many seem to be underestimating the earnings power that has been unleashed by tax cuts and deregulation.


TOP 5 PERFORMERS FOR THE MONTH

 
Symbol Rating Target Month Return Comment
CTRL BUY  $30.00

27.5%

 Beat & raise, provides year end guidance
NVEE BUY  $ 52.00

17.5%

 Beat & raise, raises year end guidance
QNST BUY  $ 16.75

14.4%

 Rebound from post eps report sell-off
EBS BUY  $60.00

14.1%

 Makes announcement of large acquisition
HBP BUY  $ 9.75

7.7%

 Better than expected revenues

In August, our top performer was Control 4 (CTRL) + 27.4%  an emerging leader in smart home technology topped earnings forecasts and guided for solid numbers into 2019. NV5 (NVEE), popped + 17.5%. NV5, an environmental and energy Focused E&C firm topped expectations and guided higher. NVEE, one of our top picks over the last two years nearly tripling. New initiation, Quinstreet, a leader in digital marketing (QNST) ticked up 14.4%.


WORST 5 PERFORMERS FOR THE MONTH
 
Symbol Rating Target Month Return Comment
SALM BUY  $ 9.00

-22.2%

 Gives back prior month’s gain on weak earnings report
BLX BUY  $33.65

-13.0%

 Misses estimates ,higher than expected costs
HNNA BUY  $23.75

-7.4%

 Aum outflows offset small acquisition
DAKT BUY  $12.00

-5.6%

 Lower backlogs projected
GASS BUY  $ 6.00

-5.6%

 Profit taking

 
Salem Media (SALM) lead to the downside falling – 22.2%, reversing much of the gains from the previous two months as earnings disappointed again. Banco Latino Americano (BLX) was off 13% as lower spreads from higher interest rates hurt net income. HNNA fell 7.4% as continued Capital outflows pressured earnings.

Please join us September 20th in Dallas for our Midwestern values conference where will be focusing on several of the names mentioned above and other under covered, under followed and misunderstood situations that we believe can perform exceptionally well over the next 12 months. Visit www.singularresearch.com

At singular research we wish to thank our clients and followers for their continued commitment and support of our unbiased Independence research.

Singular Research Staff