Industrial Strength: Making Sense of the Sector

Published on
May 20th, 2019
Duration
28 minutes


Industrial Strength: Making Sense of the Sector

The Expert View ·
Featuring Scott Davis

Published on: May 20th, 2019 • Duration: 28 minutes

Scott Davis of Melius Research unpacks his view on the industrials. Davis makes the overall case for the sector, discusses how industrial stocks are deeply entwined with national economies, and explains how his overall thematic and macroeconomic views are related to individual names. Filmed on May 1, 2019 in New York.

Comments

Transcript

  • PG
    Philippe G.
    2 June 2019 @ 19:09
    Appreciate the company suggestions, some new names to research! Interesting call on 3M, certainly a dividend growth favourite for many I'd imagine!
  • GF
    Gordon F.
    27 May 2019 @ 15:14
    Good discussion, but again - PLEASE voice over the questions. There's no benefit in watching a talking head, so I just listen, but then I hear that little chirp that indicates that a question has flashed on the screen, but I don't see it. Then I have to guess from what follows what the question was. I don't care if it's Justine or a computer (from best to worst you might say), but I want to HEAR the questions.
  • SB
    Stephen B.
    26 May 2019 @ 22:08
    I worked in this sector all my life (manufacturing, infrastructure, electrification etc.) and i believe this was a pretty good summary of the industrial sector. Davis also reminded me that infrastructure can have its own business cycle, due to the long planning horizon of many projects. I recall well how, back when we used to have business cycles (in the 1970's and 80's) it would very often happen that we were were busy while all other sectors were experiencing tough times.
  • VP
    Vincent P.
    21 May 2019 @ 16:18
    Very good.
  • CM
    C M.
    21 May 2019 @ 02:24
    For those that have been missing the bull perspective, Scott delivers in this video. His longer term macro perspective is good, but seems to discount near term risks. While I agree that predicting the black swans is impossible, agree with Cyril that valuations do need to play into the investment. Will be interesting to see if he is correct is that we are only in the 4th inning of the industrial cycle. Does seem to counter himself when he says he doesn't like MMM for the next couple of years, but then recommends buying industrials on any pullbacks and mentions MMM as an example of one that has pull backed. But overall agree with his themes, it is the timing that is the hitch.
    • AC
      Andrew C.
      21 May 2019 @ 03:03
      100% agree. Invest now, and do nothing more. Else do you really think that you can time your entry into the market?
  • CL
    Cyril L.
    20 May 2019 @ 18:04
    So... It's all about long-term secular demand. Costs and valuations don't matter. Hmmm... I hope their actual framework is more sophisticated than that.
    • AC
      Andrew C.
      21 May 2019 @ 03:00
      The valuation of offshore oil drillers is 0.25 (P/B). Shipping companies around 0.35. Many base metal miners well-below 1.0. I'd reckon valuations do matter. Especially as India and others are electrifying, as he states.
  • TR
    Travis R.
    20 May 2019 @ 17:34
    Electrification of the economy will ramp demand for key industrial metals ie. copper, graphite, lithium, cobalt, etc. The US Senate is working on bipartisan legislation to fast track domestically sourced strategic metals: https://apnews.com/Globe%20Newswire/5d7af44217ad254a98a4e0bd18b4cdcf
  • IC
    Ibrahim C.
    20 May 2019 @ 06:41
    Really liked the ideas covered here; however the important aspect is to know the rate of certainty that these Industrials would definitely bring back their investments to US and what is really the juice that makes them do that? The tax relief was already over and In the new world of tariffs how the local economy of USA will prove to lift the industrial to the next level?