Author: Tristan d'Aboville

Tristan d’Aboville is an Executive Director, Research Analyst, managing the European Research Product. Mr. d’Aboville has more than 16 years of experience in equity research and sales. Since joining the firm in 2012, he has applied his client-centric style with analysts and portfolio managers, anticipating and exceeding their needs. He writes the well-received weekly European commentary, and follows it with a client conference call to discuss findings. Prior to William O’Neil + Co., Mr. d’Aboville was a top-producing salesperson at Kepler Capital Markets, formerly known as Julius Baer, and at Natixis Bleichroeder, covering European equities for large U.S. institutional clients. He started his career as an equity analyst at Aurel-BGC, later moving to Natixis Bleichroeder, where he became the lead analyst for the European Hotels, Leisure and Catering Sector. He was recognized as a Top Analyst for Predictability & Recommendations by AQ Publications in 2003. Extel named him one of the top three European analysts covering the business services and hotel & leisure industries. Prior to the securities industry, Mr. D’Aboville was an auditor with Arthur Anderson. Mr. d’Aboville earned a Master of Science in Managerial and Financial Economics from ISC Paris School of Management. Later, he studied Global Affairs at New York University. He is a Certified International Investment Analyst (CIIA). A sportif, Mr. d’Aboville enjoys kite surfing, sailing, skiing, tennis, chess, and spending as much of his free time as possible with his wife, young daughter, and son.

European Weekly Summary

Posted on by Tristan d'Aboville

Key points from this week’s report:

Please refer to the attached PDF for the full report.

 

  • The Stoxx 600 is in a Confirmed Uptrend, but the lack of price progress since the follow-through day has been a concern. The index is vulnerable to retest January lows. Thus, we recommend a selective and patient approach to increasing risk.

 

  • Sector Rotation: Positive short-term momentum continues in Energy and Financial.

 

  • European Focus List Update:

O’Neil Consumer/Retail Weekly

Posted on by Tristan d'Aboville

Planet Fitness (PLNT; $7.8B Market cap): PLNT is one of the fastest-growing operators of fitness centers in the U.S. The company operates through three segments: franchise, corporate-owned stores, and equipment. At the ICR 2022 Conference, PLNT pre-released its Q4 / FY membership levels, up 1.7M y/y to 15.2M. The company also added 132 new gyms, ahead of consensus estimates (115 additions). 98% of PLNT gyms are currently open.

O’Neil Consumer/Retail Weekly

Posted on by Tristan d'Aboville

Consumer Cyclical (XLY). With the index trading 14% off its highs, below its key support levels and finding resistance at
its 200-DMA, we remain cautious on the discretionary space. As distribution remains elevated and as markets continue to
be volatile due to uncertainty surrounding monetary policies, we recommend investors to trim stocks below their key
support levels and add only those names which have consolidated above their support levels.

European Weekly Summary

Posted on by Tristan d'Aboville

Key points from this week’s report:

Please refer to the attached PDF for the full report.

 

  • The Stoxx 600 has remained in a Rally Attempt as it was able to hold above its recent low at 454.52. The index tested its 50-DMA on Wednesday before retracing back to its 200-DMA to eventually close below it, whipping out all gains made from Monday through Wednesday. We are still waiting for a follow-through day to move the market’s status to a Confirmed Uptrend. Conversely, we monitor ~454.5 as the key level of support. Should it breach this level, the Stoxx 600’s status would be sent back to a Downtrend. 
  • Our rotation chart shows short-term momentum (over four weeks) continuing to improve in Energy, Financial, and Transportation. Tech, Health Care, Retail, and Capital Goods continue to show weak trends in their short-term momentum (over four weeks).
  • European Focus List Update: We did not make any change to the list last week. The list currently consists of 23 stocks, overweighted toward Financials and Capital Equipment. Actionable ideas include Compass Group (CPG.GB; CPG LN), Jeronimo Martins (JMP.PT; JMT:PL), and Beneteau (CHBE.FR; BEN:FP).

Relaxo Footwear

Posted on by Tristan d'Aboville

Emerging Focus List Relaxo reported weak Q3 FY22 results.
Revenue grew 10.6% y/y, missing estimates by 8%, while adjusted EPS declined
22% y/y, missing estimates by 26%. We recommend that investors hold on to
the stock and trim positions if it breaches below INR 1,150.

European Weekly Summary

Posted on by Tristan d'Aboville

Key points from this week’s report:

Please refer to the attached PDF for the full report.

  • It wasa bearish and volatile week for the European Markets as investors exited risk assets amid fear of a hawkish Fed statement and slowing economic growth. Corporate earnings have so far failed to provide confidence about the stalling recovery. We maintain a cautious view on the overall market and recommend a patient approach to adding risk. Continue to focus on ideas showing strong relative strength while reducing exposure to lagging ideas.
  • Energy sector led the markets last week. On our rotation chart, Energy, Financial, and Transportation showed improving short‐term momentum(over four weeks). Tech, Health Care, and Retail stocks continue to show weak trends in short‐term momentum (over four weeks).
  • European Focus List Update: We added none and removed Straumann Holding (STMN.CH), EQT (EQT.SE), Dassault Systèmes (DSY.FR), Pandora (PND.DK), Sika (SIKA.CH), and Interpump Group (IP.IT). The list currently consists of 23 stocks.
  • Actionable namesin the Focus List include Compass Group (CPG.GB; CPG LN), Jeronimo Martins (JMP.PT; JMT:PL), Beneteau (CHBE.FR; BEN:FP), and Aker BP (AKEP.NO; AKRBP:NO).

O’Neil Consumer/Retail Weekly

Posted on by Tristan d'Aboville

Consumer Cyclical (XLY). Although the index had a major reversal yesterday closing in positive territory after an intraday sell-off, we remain cautious on the discretionary space. The index is still 15% off high, distribution remains elevated and it is still trading below its 200-DMA. With the US market still in a downtrend, we recommend to be cautious and wait for more clues that the index may have bottomed.

Consumer Staples (XLP): Staples have played their defensive role in a weak market (US market in a downtrend). The XLP has continued to relatively outperformed the general market reflected by its rising RS line. The index is trading constructively with support at its 50-DMA on accumulation.

Retail (XRT): The retail ETF declined 7.5% last week and continued to trend downward. However, 

European Weekly Summary

Posted on by Tristan d'Aboville

Key points from this week’s report:

Please refer to the attached PDF for the full report.

 

  • The Stoxx 600 remains in an Uptrend Under Pressure with four distribution days. It closed the week below its 50-DMA support level and is now testing its 200-DMA. With increasing distribution across the 16 markets and breadth extremely thin, we maintain a cautious view of the overall market. Multiple areas of the market are now broken technically and very few stocks have shown signs of bottoming. Thus, we advise remaining defensive and taking a patient approach to add risk.
  • Defensive sectors led in relative terms. Our rotation chart shows short-term momentum (over four weeks) continuing to improve in Energy, Finance, Transportation, Utility, and Basic Material, while Tech, Health Care, and Retail continue to show weak trend in their short-term momentum (over four weeks).
  • European Focus List Update: We added Compass Group (CPG.GB). We removed Mips (MIPS.SE), Halma (HLMA.GB), JD Sports Fashion (JD.GB), Nibe Industrier (NIBE.SE), Ashtead Group (AHT.GB), Soitec (SOI.FR), and IMCD Group (IMCD.NL). The list is now down to 29 stocks. Actionable names in the Focus List include Compass Group (CPG.GB), Jeronimo Martins (JMT.PT), Aker Bp (AKEP.NO), Paragon Banking Group  PLC  (PAG.GB), and Richemont  (CFR.CH).

O’Neil Consumer/Retail Weekly

Posted on by Tristan d'Aboville

Consumer Cyclical (XLY) The index has been underperforming the general market since the beginning of the year (RS
line in a downtrend), particularly exacerbated by the weakness of Amazon shares (22% of the index). The ETF is still
trading in a flat base with immediate support at its 100-DMA followed by $189.90 (3% downside). We recommend
underweighting the sector.