Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

Baptista Research is an independent financial research house focused on the U.S. markets. We provide equity research as well as credit research reports on the top-listed U.S. companies with most of our focus on technology, consumer goods and services, automobiles, industrials, oil and gas, pharma, and healthcare. Our research has served more than 3000 institutional investors including mutual funds, hedge funds, banks, family offices, and various buy-side firms. We operate a research subscription service where institutions, as well as retail investors, can have priority access to all our research. We also have a wide distribution of our research reports across some of the top global financial platforms. Apart from equity research and credit research, we also provide advisory services with respect to mergers & acquisitions (M&A), private equity/ venture capital fundraising, valuation reports, and investment management services for corporates.
Baptista Research is owned and managed by Ishan Majumdar, an ex-Venture Capitalist/ Investment Banker, a Chartered Accountant, and a Masters’ degree holder in Management from HEC Paris. Ishan has nearly a decade of experience in Mergers and Acquisitions, Leveraged Buyouts (LBOs), Venture Capital Investing, Corporate Strategy, and Valuation in front-office roles at the likes of BNP Paribas CIB, Credit Agricole CIB, Groupe Danone, and TIW Private Equity. He has worked on and closed multiple acquisition deals, leveraged buyouts, and start-up investment transactions.

Equity Capital Markets

<ul><li>Caterpillar had a decent quarter, performing quite well in a challenging environment.</li><li>The company’s sales, earnings, and revenues have declined in the current quarter mainly because of lower end-user demand.</li><li>Caterpillar maintains a strong balance sheet, has been introducing various innovative products and is increasing its digital capabilities.</li></ul>

Caterpillar had a decent quarter, performing quite well in a challenging environment.The company’s sales, earnings, and revenues have declined in the current quarter mainly because of lower end-user demand.Caterpillar maintains a strong balance sheet, has been introducing various innovative products and is increasing its digital capabilities.

Caterpillar Inc.: Market Positioning & Macro-Economic Outlook

Credit

<ul><li>Caterpillar had a fairly good 2021 as a result of volume gains and favorable pricing, sales and revenues increased in all regions and in all three primary segments.</li><li>Increasing oil prices, a rise in U.S. infrastructure budgets, potential housing demand, and rising mining activity should benefit the company.</li><li>Based on our credit analysis, the company merits a Credit Evaluation Score of A with a stable outlook and as per our Financial Strength Indicator, its performance is 3.36/ 5.</li></ul>

Caterpillar had a fairly good 2021 as a result of volume gains and favorable pricing, sales and revenues increased in all regions and in all three primary segments.Increasing oil prices, a rise in U.S. infrastructure budgets, potential housing demand, and rising mining activity should benefit the company.Based on our credit analysis, the company merits a Credit Evaluation Score of A with a stable outlook and as per our Financial Strength Indicator, its performance is 3.36/ 5.

Caterpillar Inc.: Detailed Credit Analysis & Financial Strength Evaluation Report

<ul><li>Caterpillar had a decent 2021 as the management continued to execute their long-term profitable growth strategy while meeting strong customer demand.</li><li>Due to volume gains and favorable pricing, sales and revenues increased in all regions and in all three primary segments.</li><li>Rising oil prices, increased infra spends, potential housing demand, and rising mining activity should benefit the company.</li></ul>

Caterpillar had a decent 2021 as the management continued to execute their long-term profitable growth strategy while meeting strong customer demand.Due to volume gains and favorable pricing, sales and revenues increased in all regions and in all three primary segments.Rising oil prices, increased infra spends, potential housing demand, and rising mining activity should benefit the company.

<ul><li>Caterpillar had a strong third quarter result as the management continues to strive to minimize the impact of supply chain difficulties and the inflationary environment.</li><li>The rising prices of commodities, metals, and oil are bound to benefit the company as they would result in increased mining activity.</li><li>The company has also seen a higher profitability driven by higher volume, advantageous pricing, and decreased restructuring expenses.</li></ul>

Caterpillar had a strong third quarter result as the management continues to strive to minimize the impact of supply chain difficulties and the inflationary environment.The rising prices of commodities, metals, and oil are bound to benefit the company as they would result in increased mining activity.The company has also seen a higher profitability driven by higher volume, advantageous pricing, and decreased restructuring expenses.

Caterpillar Inc: A Major Beneficiary Of The Infrastructure Bill (12/2021)

Asset Allocation & Fund Positioning, Copley Fund Research

Steven Holden

Asset Allocation & Fund Positioning

Copley Fund Research

Copley Fund Research provide research and data on asset allocation among Global and Emerging Market equity funds.  The analysis details absolute and relative positioning across countries, sectors and industries together with highly granular data on single stock and single fund allocations.  The data is updated monthly with time series going back to January 2011.

Global Research - Analysis of 165 prominent Global equity funds, combined AUM $335bn
GEM Research - Analysis of 127 prominent global EM equity funds, combined AUM $250bn

Asset Allocation - Global and GEM Equity

Cross Asset Strategy

Over 50% of allocations are in the US with the bulk of the remainder split between Japan, China &amp; HK and the major European nations.  The EMEA overweight is comprised mainly of the UK, Netherlands, France and Germany, with active managers running underweights in the US, China &amp; HK, Australia and Japan.UK allocations hover around their lowest levels in history, though managers remain stubbornly overweight compared to the MSCI AC World index.  A total of 62% of managers are overweight the UK at an average +1.88% above benchmark.  Global Value investors are approaching their largest ever overweight in UK stocks of 3.64% above benchmark.Another month, another slump in Japan exposure.  Average weights in Japan stand at an all-time low of 5.06% with 85.5% of funds exposed (another low). <a href="https://www.smartkarma.com/entities/sony-corp" target="_blank" data-smartkarma-citation="entities:563:1" rel="noopener">Sony Corp (6758 JP)</a> and <a href="https://www.smartkarma.com/entities/kddi-corp" target="_blank" data-smartkarma-citation="entities:639:1" rel="noopener">KDDI Corp (9433 JP)</a> are the most widely held stocks, with 23% and 21% of funds holding a position.Tech exposure is at record highs, though this is matched by a record underweight of -0.47%.  Indeed, the percentage of funds who are overweight technology has fallen to below 50% for the first time since the end of 2018, a sign that Global managers are tilting their portfolios away from Tech.German Industrials allocations have hit a 4-year high as more Global investors add exposure to the sector. <a href="https://www.smartkarma.com/entities/deutsche-post-ag" target="_blank" data-smartkarma-citation="entities:21608:1" rel="noopener">Deutsche Post AG (DPW GR)</a> and <a href="https://www.smartkarma.com/entities/siemens-ag" target="_blank" data-smartkarma-citation="entities:21713:1" rel="noopener">Siemens AG (SIE GR)</a> were the key stocks behind the move, with 4.2% and 2.4% of funds adding exposure over the last 6-months.Alibaba has seen closures by some of the larger holders in our analysis, led by American Funds Capital World Fund (-$1.1bn) and New Economy Fund (-$451m).  Though closures have dominated, selected funds have opened exposure during this period of volatility, including Invesco's Global Focus Fund and Liontrust's Global Income Fund.

Over 50% of allocations are in the US with the bulk of the remainder split between Japan, China &amp; HK and the major European nations.  The EMEA overweight is comprised mainly of the UK, Netherlands, France and Germany, with active managers running underweights in the US, China &amp; HK, Australia and Japan.UK allocations hover around their lowest levels in history, though managers remain stubbornly overweight compared to the MSCI AC World index.  A total of 62% of managers are overweight the UK at an average +1.88% above benchmark.  Global Value investors are approaching their largest ever overweight in UK stocks of 3.64% above benchmark.Another month, another slump in Japan exposure.  Average weights in Japan stand at an all-time low of 5.06% with 85.5% of funds exposed (another low). Sony Corp (6758 JP) and KDDI Corp (9433 JP) are the most widely held stocks, with 23% and 21% of funds holding a position.Tech exposure is at record highs, though this is matched by a record underweight of -0.47%.  Indeed, the percentage of funds who are overweight technology has fallen to below 50% for the first time since the end of 2018, a sign that Global managers are tilting their portfolios away from Tech.German Industrials allocations have hit a 4-year high as more Global investors add exposure to the sector. Deutsche Post AG (DPW GR) and Siemens AG (SIE GR) were the key stocks behind the move, with 4.2% and 2.4% of funds adding exposure over the last 6-months.Alibaba has seen closures by some of the larger holders in our analysis, led by American Funds Capital World Fund (-$1.1bn) and New Economy Fund (-$451m).  Though closures have dominated, selected funds have opened exposure during this period of volatility, including Invesco's Global Focus Fund and Liontrust's Global Income Fund.

Global Fund Positioning Update:  Japan Lows, US Highs, UK Value Rotation, Tencent & Alibaba Exit

United States

Caterpillar Inc. designs, manufactures and markets construction, mining and forestry machinery. The Company also manufactures engines  and other related parts for its equipment, and offers financing and insurance. Caterpillar distributes its products through a worldwide organization of dealers.

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Caterpillar Inc (CAT US)

Caterpillar Inc.: Market Positioning & Macro-Economic Outlook

Caterpillar had a decent quarter, performing quite well in a challenging environment. The company’s sales, earnings, and revenues have declined in...

Baptista Research

Caterpillar Inc.: Detailed Credit Analysis & Financial Strength Evaluation Report

Caterpillar had a fairly good 2021 as a result of volume gains and favorable pricing, sales and revenues increased in all regions and in all three...

Baptista Research

Caterpillar: Financial & Price Forecasts

Caterpillar had a decent 2021 as the management continued to execute their long-term profitable growth strategy while meeting strong customer...

Baptista Research

Caterpillar Inc: A Major Beneficiary Of The Infrastructure Bill (12/2021)

Caterpillar had a strong third quarter result as the management continues to strive to minimize the impact of supply chain difficulties and the...

Baptista Research

Global Fund Positioning Update: Japan Lows, US Highs, UK Value Rotation, Tencent & Alibaba Exit

A detailed look at investor positioning among 380 active Global strategies, covering the major themes in country, sector and stock exposure.

Steven Holden

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