Vermilion Macro Vision: Services Sector Synopsis
Services Sector: Underweight. The market leadership moved to the higher-beta and cyclical areas in the summer, as the economy seemed to refute every negative postulated. With that, this more defensive Sector started to suffer in terms of performance. The Data Processing Services/Outsourcing Groups, once leaders, saw their RS contract versus the higher beta Technology Sector. While the price trends remain largely intact, the RS has been going lower throughout most of 2016; thus, we lowered our recommendation to Underweight and are sticking with it. There remains opportunity from a bottom up/stock picking perspective. Our favorite stocks: V, MA, PYPL, FLT (pullback opportunity), WEX, CLGX, ACN, GIB, JEC, EME, WM, RSG, TNC, and KAR (see attached document for complete sector thoughts and recommendations).For a trial to Vermilion Technical Research call (952) 922-7500, or visit our website at: www.vermilioncap.com
CoreLogic is an information, analytics, data-enabled software platforms, and services provider. The company providesdatabase covering real property and mortgage information, judgments and liens, building and replacement costs, parcel and geospatial data, criminal background records, and eviction information, among other data types. The company's segments are: Property Intelligence and Risk Management Solutions, which delivers housing market and property-level insights, predictive analytics and risk management capabilities; and Underwriting and Workflow Solutions, which provides mortgage origination and monitoring solutions, including underwriting-related solutions and data-enabled valuations and appraisal.
Vermilion Research delivers timely, actionable, and unique research inputs to professional investors. Our research strategists highlight securities which we believe are at major inflection points, based on our various proprietary technical indicators, and offer asymmetric risk/return profiles. We believe our research methodology, which is not limited by industry sector or market capitalization, enables us to deliver superior investment recommendations.
Our process begins by organizing all actively traded stocks into coherent sectors, then into logical industry groups. We then apply our proprietary relative strength tools to identify developing price trends. Once attractive trends are identified within a selected sectors or groups, we screen for individual stocks which we believe offer the best risk/reward profile. Vermilion offers U.S. and global equity market research products. Vermilion’s research team, which has received numerous awards and accolades, has a combined 70 year of experience in the analysis of investment securities.
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