currencies and weekly wrap -3

10:17 12-Nov-21

Two GRoDT notes to add...

Orbital is changing CFOs to favor a former associate from Quanta Services who is willing to work in Houston.  There's something to be said for working in person, but it also seems like more of the good ole boy network to me.  That can be profitable, especially with $42b in proceeds from the infrastructure act still exempt from transparency via the Administrative Procedure Act.  Supposedly, the workaround is have each state post its plans online, but the devil is in the details.  The real issue for me as an investor is that political windfalls are not very predictable and not necessarily repeatable.

eMagin's earnings miss today may not have been completely predictable either:

• a loss of 3 cents per share misses by a penny
• from $5.8M of revenue, which misses by $1.4M

However, given how often the company has had production issues in the past, it's hardly surprising.  Perhaps that is why EMAN hasn't moved on the news.  Management is now engaging outside help on the issue as well as AS9100 quality certification, which is expected in 1Q22.

I might discontinue coverage of both stocks entirely when adding new ones.

After bouncing around €/$1.16 since the latter part of September, American inflation is finally crashing the currency markets.  We've fallen below €/$1.145 and are seeing similar effects across the board, including the rupee and Canadian dollar.  American equity futures are still positive for the moment, but waning; this isn't good for stocks.

VIRT remains my best hedge, and its Trade Execution Services and Triton platform were each recognized as best in class for the second year in a row.  This will also reinforce the already apparent rotation toward dividends, where I note that PPL Corp. has joined Energy Impact Parters' fund, making it a test bed for new decarbonization technologies.  With COP26 winding down today with weaker language than last time, we should see the rush of such media wane; I find it ironic that Egypt is hosting next year's summit. 

The trend I noted toward smaller companies is accelerating as well, with J&J and Toshiba splitting into two and three firms, respectively.  I reiterate that none of this is good for India, or a conglomerate like Ebix and ABB.  I'm looking at adding new energy-centric picks as we close out the year, but am also willing to double down on my natural gas ones.