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Zain Abbas

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  • This Industry Is Flying: Which Stocks to Buy?

    By Zain Abbas - May 17, 2013 | Tickers: AER, AL, AYR

    Management teams’ sense of optimism about the aircraft leasing industry’s outlook, which emerged during last quarter’s earnings, was still noticeable during the 1Q13 reporting season. The market continues to witness improving aircraft leasing fundamentals that should help all aircraft leasing stocks.

    However, the question is, which stocks in this industry will provide the best returns?

    Investment thesis

    Aircastle (NYSE: AYR) was the first company to report its quarterly more »

  • Are Gold Stocks Still Attractive?

    By Zain Abbas - May 16, 2013 | Tickers: AEM, GG, IAG

    Gold price crashed from above $1,700/oz to as low as $1,330/oz when Cyprus government said that a sale of gold reserves worth 400 million euros was among the options for its contribution towards an international bailout. This obviously had its impact on the gold stocks.

    In the ongoing season, many had a belief that the gold mining companies would cut their guidance for the year given more »

  • 3 Stocks to Buy on Improving Industrial Sector

    By Zain Abbas - May 15, 2013 | Tickers: CCK, MTW, MTZ

    On a relative scale, the industrial sector has not been performing well on a year-to-date basis. This is in contrast to what the market had expected especially after an improving housing market and growth in developing economies. However, the good news is that the industrial goods sector has been on a tear since the last week after China reported solid growth figures.

    The following graph shows that:

    The question arises more »

  • Finding the Right Company to Invest in this Industry

    By Zain Abbas - May 15, 2013 | Tickers: ANR, ACI, CLD

    Coal demand has been squeezed since the sharp decline of natural gas prices. The decline in demand has caused a severe decline in the prices which has meant declining profitability for the coal companies over the last two years or so. To make situation worse, even the global demand for met coal is declining (due to declining demand for steel). This has given some tough time to coal players with more »

  • Is there a Bright Spot in this Industry?

    By Zain Abbas - May 15, 2013 | Tickers: AKS, NUE, STLD

    Steel industry, just like Aluminum industry, has been going through a “prisoner’s dilemma”. No single company is willing to reduce its production and as a result all players in the industry are suffering from the overcapacity syndrome. In this situation, can we still find attractive players in this industry? Let’s have a look:

    AK Steel (NYSE: AKS) exited Q1’13 with total liquidity of ~$1.05b, largely unchanged more »

  • 1 Aluminum Stock to Buy, 2 to Hold

    By Zain Abbas - May 14, 2013 | Tickers: AA, CENX, NOR

    Aluminum industry has for long been plagued by overcapacity issue where the players have failed to attract enough demand to meet the supply and hence aluminum prices have not moved in a favorable (upwards) direction for the industry.

    A Surprise call

    This is why the market was surprised when Alcoa (NYSE: AA), the first company to report the earnings in the earnings season, said that it perceives the global end more »

  • Is China the Land of Opportunity for Mining Equipment Companies?

    By Zain Abbas - May 14, 2013 | Tickers: CAT, JOY, MTW

    China has been called the land of opportunities for industrials. Many mining equipment companies have turned towards this emerging economy in hopes of fueling enough growth to make up for declining mining activity in North America.

    However, China hasn’t kept up with the expectations of these industrials. Its economy hasn’t grown as quickly as anticipated. However, channel checks show that excavator sales rose by 6% (on a year-over-year more »

  • These Automakers Are Worth Buying Despite a Temporary Blip

    By Zain Abbas - May 14, 2013 | Tickers: F, GM, TSLA

    Earnings season is in its final stages with most of the large companies already done with reporting their quarterly results. Auto stocks reported a strong quarter on the basis of strong U.S. auto sales. However, the recent weakness in auto sales for consecutive three months (Feb-April) has sent bearish signals to the market.

    In this situation, it is important to analyze the prospects of Detroit-based automakers. Let’s have more »

  • 2 Rental Car Stocks to Buy

    By Zain Abbas - May 13, 2013 | Tickers: UHAL, CAR, HTZ

    Perhaps the largest development for the rental companies this year has been commentary around positive US pricing data – the positive comments, combined with an overall renewed interest in the rental space, has yielded stellar trading performance for Avis Budget Group (NASDAQ: CAR) and Hertz Global (NYSE: HTZ).

    What needs to be questioned is: Will this strong pricing persist? If yes, then it might not be too late to jump into more »

  • How to Play the Boom in the Chinese Auto Market

    By Zain Abbas - May 13, 2013 | Tickers: DLPH, TRW, VC

    One way to make money from the concept of growing economies has been to invest in companies that are expecting incremental sales from those regions. Other investing themes can be to invest in companies that already rely heavily on those developing areas for their revenues. The Chinese economy has been a hot topic since the start of 2011 as money managers have been shifting their concentration from the recession hit more »

  • Light Truck Suppliers: Finding the Right Stock to Invest

    By Zain Abbas - May 13, 2013 | Tickers: AXL, DAN, LEA

    We have been hearing a lot about light trucks and their rising demand due to the housing recovery (light trucks are mostly used to transport construction material). In a recent post of mine, I highlighted how sales of light trucks have helped keep the U.S. auto sales momentum going. However, we have always missed the aspect of light-truck part suppliers. How are they performing? Let’s have a look more »

  • The Good and the Bad of the Waste Management Industry

    By Zain Abbas - May 13, 2013 | Tickers: RSG, WCN, WM

    Waste management companies reported mixed quarterly earnings with two of the three companies reporting an earnings beat. Since the release, these stocks have been up more than 5% till date as shown by the graph:

    It will be interesting to note what the bears and bulls have to say about these companies:

    Waste Management (NYSE: WM), the largest waste management company by market cap, reported its earnings on April 24 more »

  • Which Intermodal Players to Buy in the Trucking Space

    By Zain Abbas - May 13, 2013 | Tickers: HUBG, JBHT, PACR

    Intermodal has been a growing theme in the transportation industry. For those who don’t know, intermodal segment of any trucking company is like a container business that works in conjunction with railroads. This growing theme has been like a lamp in the darkness for the ‘coal-beaten’ railroad industry. However, it is not the railroad industry that I intend to discuss here. The trucking industry will be my main point more »

  • 2 Engineering & Construction Stocks to Buy, 1 to Hold

    By Zain Abbas - May 13, 2013 | Tickers: CBI, FWLT, KBR

    Recently held Offshore Technology Conference in Houston has brought along some important takeaways for the investors in Engineering & Construction (E&C) companies. In my earlier posts, I have been emphasizing on how the E&C sector has been a main beneficiary of the shale gas boom which promises to bring multi-billion dollar investment cycle in this industry.

    Offshore Opportunities

    This post is more focused on the offshore related opportunities that more »

  • 3 Things to Learn From April Auto Sales

    By Zain Abbas - May 9, 2013 | Tickers: F, GM, TM

    Seasonally Adjusted selling annual rate, or SAAR, has been a key measure of the progress of the US auto market. April U.S. light vehicle SAAR came in at 14.9 million, solidly below the Street’s estimate of 15.2 million. The SAAR result was above the Apr’12 figure of 14.1 million, but was 350,000 units below the Mar’13 number of 15.3 million. This more »

  • 3 Auto-Parts Companies to Buy Despite Heavy European Exposure

    By Zain Abbas - May 7, 2013 | Tickers: BWA, GNTX, TEN

    A declining European economy and the recent debt crisis in that part of world have given money managers some ‘food for money.’ One way to make money has been to short European automakers like Peugeot or Renault. However, another way to play this theme has been to short those auto-part manufacturers that heavily rely on the European economy for their revenue. And given that there are no bullish viewpoints on more »

  • Which Intermodal Players to Buy in Trucking Space

    By Zain Abbas - May 7, 2013 | Tickers: HUBG, JBHT, PACR

    Intermodal has been a growing theme in the transportation industry. For those who don’t know, intermodal segment of any trucker company is like container business that works in conjunction with railroads. This growing theme has been like a lamp in the darkness for the ‘coal-beaten’ railroad industry. However, it is not the railroad industry that I intend to discuss here. Trucking industry will be my main point of concern more »

  • 3 Auto Part Stocks to Buy Despite Heavy European exposure

    By Zain Abbas - May 1, 2013 | Tickers: BWA, GNTX, TEN

    A declining European economy and the recent debt crisis in that part of world have given money manager some ‘food for money’. One way to make money has been to short European automakers like Peugeot or Renault. However, another way to play this theme has been to short those auto-part manufacturers that heavily rely on the European economy for their revenues.

    Three stocks that have come under firing have been more »

  • 3 Auto Stocks to Buy

    By Zain Abbas - May 1, 2013 | Tickers: F, GM, TM

    US auto sales figures are released on the first of every month. The sales are surging in the last 4-5 months or so because of the easy availability of credit, pent up demand, high average age of fleet in the US, and so on, as seen in the chart below.

    However, what remains to be seen is if this momentum will be carried on for the rest of the year more »

  • Understanding the Housing Recovery in the Language of the Paint Industry

    By Zain Abbas - April 30, 2013 | Tickers: PPG, SHW, VAL

    Housing recovery debate

    The housing recovery has been a point of debate for some time. Both residential and non-residential spending have climbed up as depicted by the rising house prices and Architectural Billing Index (ABI). Some believe that the housing market is on its way to a revival after the housing bubble burst in 2006. On the other hand, many believe that the rest of the economy is teetering away more »

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