FlowPoint Research – FACTOR WATCH

Summary

  • 91% (455 of 500) of stocks in the S&P 500 rose during the week ended May 29, 2020. The “reopening” theme was evident. For example, the top 50 performers in the S&P 500 included cruise lines, hotels, banks, REITs and airlines. The top 50 gained on average 11%, though these stocks remain -23% for the YTD.
  • The most effective factors in stock performance for U.S. stocks last week were Value, Size and Profitability. “Value” measures have been the biggest detractors to performance YTD (-18%), and its bounce has been welcomed by those sitting out the rally in Growth.
  • The Buyback Kings had a good week – those companies that buy back the most of their own stock outperformed by 1.56%. The further back in time we look, the more important buybacks have been to share price performance. As a group, the Buyback Kings rose 3.6% on average for the week, and are down 40.9% YTD. These include many of the “reopening” theme stocks.
  • For the YTD 2020 through May 29, the top 50 stocks in the S&P 500 are up 28.7% YTD on average, and 42 of these top 50 scored a “1”, or our highest ranking on Trend1, and have very limited share buybacks in place (3% of market cap, on average, vs. 32% for the Buyback Kings).

Exhibit 1: Week Ending May 29, 2020 Factor Performance – Russell 3000 Index Quantiles (Sector Neutral)

Source: FlowPoint, Bloomberg




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