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Summary It is not clear what a new market design would look like, but many politicians have called for price caps, albeit in many different forms. The merit order ensures that the cheapest technologies enter the market first but implies that the price is set by the most expensive ...
Summary England and Europe’s near-total reliance on Russia for their energy needs has prices spiking massively the last several months. We are starting to see the latest government bailouts - those of utilities. We feel that the only real consequential downside moves in the...
Summary Jackson Hole reset expectations to focus more on inflation. The U.S. dollar should stabilize over the medium-term amid hawkishness from other central banks and slowing economic data. At stake is Europe’s ability to refill their storage tanks ahead of winter. ...
Summary We believe that cash flow and debt sustainability are likely to become increasingly important as real economic growth slows and credit access tightens. Cash flow provides a link between a company’s income statement and their balance sheet. Focusing on the Russel...
Summary Today's market X-ray shows the returns for each index, asset class, sector, and so on, since the recent low point on June 16th. Of the global indices, US small caps are in the lead, followed by the NASDAQ. High beta stocks are the most preferred factors since June 16. ...
The regulated-electric utilities have a lot of growth ahead of them amid the global energy transition. On the growth side alone, aside from the fact that we expect huge population growth globally, I think what you're seeing, particularly in North America, is that growth for the utilit...
As companies adjust to inflation, rising interest rates, and a likely economic slowdown, investors are struggling to compute future earnings and the impact on stock valuations. Broadening the sources of stability can help diversify risk and return potential. Geopolitical risk and ...
The potential acceleration of energy transition could create substantial tailwinds for NextEra Energy. The firm has outperformed the broader market in three out of three periods that were characterized by low consumer confidence in the last 20 years. The strong track record of div...
Energy stocks, especially gas utility stocks, are precedented to outperform the market in times of high inflation. The Russia-Ukraine situation amid other geopolitical and macroeconomic factors are catalysts to high inflation and upward-spiraling energy prices. Southwest is a low ...
If higher prices, which have now broadened, are allowed to persist, they can become sticky. A wage-price spiral, where rising wages beget rising prices, which cause further pressure on wages, certainly could allow inflation to be a challenge for longer than expected. In general, tradi...