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Corporate Debt: Where is the Danger? (Munich Personal RePEc Archive, 66 page read) Authors perform debt sustainability analysis for US corporates. Based on liquidity needs and embedded leverage, rather than net repayments, shows some sectors are more resilient that often assumed. The utilities sector is, however, significantly exposed through interest rates and profitability shocks.
Stock Splits – What Happened to Them? (Trinity Asset Management, 2 min read) Whether it’s less rich valuations compared to the 1990s (and reduced need for perceptions of cheaper valuation), the growth of passive funds or fewer companies compelled to keep shares available to loyal fans, the accounting exercise of stocks splits is increasingly rare.
Regression to Trend: Another Look at Long-Term Market Performance (Advisor Perspectives, 2 min read) The inflation-adjusted S&P reached 133% above its long-term trend at the end of January, an all-time high and more than three standard deviations above trend. The 2007 peak was around two standard deviations above trend.
Earnings Recession Set to End, as S&P 500 Earnings Growth Turns Positive (Fidelity, 1 min read) Fourth quarter earnings are on track to eek out a positive performance ending three consecutive quarters of contraction in corporate earnings. But only once earnings season is complete can the earnings recession be fully assessed.