Nibe Industrier (NIBE.SE; NIBEB SS) – $19B market cap; $33M ADV: We added Nibe Industrier to our Developed Markets Focus List as it broke out of a stage-one 19-week cup-with-handle base. The company is the leader
in the heat pumps industry for single-family homes and commercial properties market in North America. It is witnessing strong order inflows for heat pumps driven by a shift in focus toward self-reliance and climate-friendly
energy. It aims to double its capacity in the next 3–4 years to cater to this demand, which would be supported by inorganic growth.
Author: gundaboina saikiran
O’Neil Capital Equipment Sector Weekly
Mitsubishi electric (UM@N.JP) and Mitsubishi heavy announced plans to merge their power generator business to improve market competitiveness. Mitsubishi Electric will be the majority shareholder in the new company.
UM@N.JP is trading below its key moving averages. It has a poor RS Rating of 35 and an A/D Rating of D-. MH@N.JP has bounced back from support along its 50-DMA and is trading less than 5% below its pivot.
O’Neil Capital Equipment Sector Weekly
Per Reuters, U.S. lawmakers have proposed extending the deadline for the certification of the two new versions of Boeing (BA) 737-Max to September 2024 from December 2022. Without congressional action, the Federal Aviation
Administration cannot continue working on any max certification after the initial deadline. The stock is actionable after breaking out of a stage-one cup base and has a good technical profile.
Reliance Steel & Aluminum
Key points:
- Buy RS stock as it is breaking out from a 29-week consolidation base with a pivot range of $211.7 – $222.3. It has strong support at its 50- and 200-DMA. The company is the market leader in downstream metal processing in the U.S. and has superior margins compared with its peers due to its decentralized and cyclicality-immune business model. It has good growth opportunities due to the onshoring of semiconductor manufacturing.
- Excellent fundamental profile: EPS Rank 93, Composite Rating of 98, and SMR Rating of A, supported by expanding margin and ROE.
- Good technical profile: RS line is trending higher with a high RS Rating of 91 and an A/D Rating of B. Industry Group Rank has been stable in the 20–35 range over the past eight weeks.
O’Neil Capital Equipment Sector Weekly
Carlisle Cos (CSL) – $13B market cap; $138M ADV: We removed Carlisle Cos from the U.S. Focus List due to technical deterioration. The stock gapped down and breached support along its 50- and 200-DMA after cutting its fullyear revenue growth guidance to 35–40% y/y from more than 40% y/y. It faces immediate resistance along its 200-DMA.
U.S. Economic Summary
Q3 GDP expanded 2.6%: he U}S} economy grew 2}6% in Q3, according to the preliminary estimate,
20bps above consensus} he increase in real GDP reflected increases in exports, consumer spending,
nonresidential fixed investment, federal government spending, and state and local government
spending that were partly offset by decreases in residential fixed investment and private inventory
investment} Imports, a subtraction in the calculation of GDP, decreased during the period|
Mineral Resources
Key points:
- Buy Mineral Resources shares as the stock breaks out of a six-week consolidation base on strong volume following the positive Q1 FY23 trading update. The company is Australia’s largest mining contractor that is moving down the value chain in the high growth Li processing industry and has good forward visibility due to locked-in iron ore projects.
- Fundamental profile: EPS Rank 72, Composite Rating of 96, and SMR Rating of C. For FY23, consensus expects revenue and EPS growth of 87% and 380%, respectively, supported by the Li business.
- Solid technical profile: RS line is at a new high with a stable RS Rating of more than 90 in the past seven weeks. A/D Rating turned positive four weeks ago. Up/Down Volume ratio above 1 denotes strong buying interest.
- Institutional sponsorship increased 70% y/y to 723 funds as of June, denoting good accumulation.
O’Neil Capital Equipment Sector Weekly
U.S. single-family home starts declined to two-year lows in September. Total housing starts declined 8.1% m/m to 1.439M, missing estimates of 1.475M. Existing U.S. home sales declined for the eighth straight month in September.
Home sales declined 1.5% m/m, in line with estimates.
O’Neil Capital Equipment Sector Weekly
Ashtead Group (AHT.GB) announced Q1 (ended July) results. Revenue increased to $2,259M (+25% y/y), driven by a 26% y/y increase in rental revenue. EBITDA margin contracted to 46.0% (-40bps y/y). The company continues to
invest heavily in greenfield expansion ($699M in the quarter) and acquisitions ($337M). Net debt to leverage ratio grew to 1.6x from 1.3x. Management has guided for flat adjusted PAT for the full year as it expects increasing interest
costs to offset revenue growth. The stock is testing support along its 50-DMA and trading 36% below its 52-week high. It has a low RS Rating of 34 and an A/D Rating of C+.
Indian Hotels (INH.IN)
The Indian Hotels Company Ltd (IHCL) is the largest hospitality chain in India by
the number of properties. The company owns, operates, and manages hotels and
resorts under brands such as Taj, SeleQtions, Vivanta, Ama, Chambers,and Ginger.
