YWR: Global Factor Model
Disclosure: Personal Views and Market Commentary Only. These are not investment recommendations or advice. For that seek professional help.
It’s that time of the month.
Time for the YWR Global Factor Model rankings where we rank the most interesting stocks globally for a combination of rising earnings estimates, trending price momentum, and attractive valuations.
And the top 20 for August.
Turkish stocks are the big new trend. Turkish stocks have been cheap, but now the market moving positively too (price momentum), which was the missing piece. So we see Garanti Bank, Is Bankasi, Akbank, and Pegasus and Turkcell all in the top 20. We talked about the Turkey set up back in June in Two Pieces of Advice.
Also notice two shipping companies make the list; Kawasaki Kisen and Orient.
Looking at the top 300 stocks (the YWR 300) on a country basis China is dropping fast. I’ve been arguing for a contrarian buy on HK listed Chinese stocks (The HK100).
The industry chart was getting a little messy, so I removed the Pharma and Insurance sectors, which had been losing momentum and added homebuilders.
Banks and Autos & Trucks are still the top sectors. The banks sector is benefitting from the addition of Turkish Banks to the existing European Banks which have ranked well all year.
US homebuilders have momentum too and are now a top industry cluster with the stocks on P/E’s of 6, and no new housing inventory.
Autos and Trucks are a combination of two trends; the strong US construction trends and the earnings momentum in European and Japanese car companies. The top ranked stocks in this sector are: Doosan Bobcat, Mazda, Hitachi Construction, Tata, SinoTruck, Stellantis, Nissan and Toyota.
Doosan Bobcat (241560 in S. Korea) is interesting. Q2 revenues +15%, pre-tax profit +90%. On a P/E of 6x (like the homebuilders because we all know it’s not sustainable, or is it?). Doosan is benefitting from both the commercial and residential construction booms in the US.
Doosan Bobcat order book:
Below is the full August screen with all 3,600 global stocks.
There is a Global Factor Model section on the YWR Substack site where you can get the prior month factor model screens as well.