Packaging Corporation of America (PKG) – $16.7B market cap – Technicals: The stock breaking out of a stage-one cup-withhandle base. Support at its 21-DMA ($182.9; -2%) followed by its 50-DMA ($180.6; -3%). Fundamental profile: Moderate EPS Rank 51
due to an EPS decline in FY23. Composite Rating of 80 and SMR Rating of B. Recent EPS estimates for 2024 and 2025 have been
revised upward.
Author: Kenley Scott
Kenley Scott is a senior equity analyst and sector strategist covering the APAC region and the Energy sector. He is a member of the Global Focus List Committee, which approves all equity recommendations for developed, emerging, and frontier markets. Kenley also writes the Global Sector Summary, part of the Sector Strategy service, which identifies emerging sector strength and weakness across 46 countries every week. After working as a commodities broker, Kenley joined the firm in July 2006. He has a B.S. in Statistics from the University of California, Riverside and also holds a Series 65 securities license.
O’Neil Energy/Material Weekly
Bayer Cropscience (BAY.IN) – Technicals: The stock is approaching the pivot of a stage-one consolidation base. Accumulate
positions on a break above INR 6,201 (+1%). Mixed fundamental profile: EPS Rank 46, Composite Rating of 57, and SMR Rating of C.
Global Sector Strategy
After a couple of months of underperformance following huge relative upside, the U.S. Technology sector has now sharply outperformed for the past six weeks. This
includes picking up between 2-7% of alpha versus the other 10 sectors just last week. Going back to the start of its relative gains from the beginning of 2023, Technology is up 85%. No other sector has kept pace with either the S&P 500 or Nasdaq Composite. The second-best Retail is up only 34%. The average of the other 10 sectors over that period is +14%.
O’Neil Energy/Material Weekly
Ameresco (AMRC) – $1.2B market cap – Technicals: The stock recently retook its 200-DMA on above average volume for the first time since July 2023. Long positions can be taken on a break above its $37.3 resistance level. Fundamental profile: Moderate EPS Rank 69 and Composite Rating of 81. EPS is expected to improve in 2024 and 2025 after a decline in 2023.
Global Sector Strategy
As we know, the U.S. market has continued to get more concentrated. There are several ways of displaying this. One is just comparing the equal-weight S&P 500 and
equal-weight Nasdaq 100 to their market-cap-weighted counterparts. Over one year, the RSP ETF lags the overall S&P 500 by around 8%, while the QQQE ETF is trailing the overall Nasdaq 100 by over 11%.
O’Neil Energy/Material Weekly
Fluence Energy (FLNC) – $3B market cap; $50M ADV – Technicals: The stock has regained its 200-DMA on high volume and is trading above this level for the first time since early January. Modest fundamental profile: EPS Rank 54, Composite Rating of 81
Global Sector Strategy
Part of the surge is natural as indices make new highs because the number of index and sector ETFs is bound to rise at the same time. Excluding ETFs by excluding all Financials, we see the numbers have also returned to very healthy levels over three weeks.
O’Neil Energy/Material Weekly
Nextracker (NXT) – $3.3B market cap – Technicals: The stock is forming the right side of a stage-two cup base after reclaiming its 50- and
100-DMA on above average volume. Aggressive entry can be taken at the current levels. Fundamental profile: Excellent EPS Rank 98 and
Composite Rating of 87
O’Neil Energy/Material Weekly
CIMC Enric Holdings (ENRC.HK, 3899 HK) – $2.1B market cap and $4.4M ADV – Technicals: The stock is attempting to break out
of a stage-one flat base. Pivot range of HKD 8.3–8.7. Solid fundamental profile with an EPS Rank 71, Composite Rating of 93, SMR
Rating of B with accelerating EPS growth estimates for FY24 and FY25.
Global Sector Strategy
The iShares Global ex-U.S. benchmark ETF (ACWX) made a new 52-week high last week, ahead of the U.S. market, after also having held up slightly better in the recent pullback. Although still very short term, it is the first time since the 2022 lows where the global basket outperformed the U.S. market as a new potential rally began. As we can see below (green line on bottom of the chart), the relative strength line versus the S&P 500 is now about three months off its lows from early February.
