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Hodges Friday Fast Five

"In the investment business, you go to school every day, but never graduate." - Don Hodges


Friday Fast Five - 7/28/2023

by Hodges Investment Team, on July 28, 2023

Five interesting things that Hodges Capital research analysts discovered this week...

#1 CREDIT APPLICATIONS: The New York Fed recently reported that the overall rejection rate for credit applicants rose to its highest level since June 2018, standing at 21.8%, a jump from 17.3% in February.

#2 STUDENT DEBT PAYMENTS: With the upcoming restart of federal student debt payments, 88% of participants in a Piper Sandler survey stated payments would cause financial distress, and 75% anticipate they will need to prioritize bill payments. Also, entertainment (movies, concerts, sporting events) and restaurant spending were cited as the two top areas for spending cutback once payments restart.

#3 GOLF PARTICIPATION: The National Golf Foundation recently reported that rounds of golf played in June were up 5.5% compared to a year ago. Through the first half of the year, total rounds are also up 5.5% compared to the same stretch in 2022.  

#4 HOME EQUITY EXTRACTION: Total home equity extractions for Q1 of $52B declined by $63B, or 55% y/y, as both home equity lines of credit and cash-out refinancing declined. Piper Sandler notes that the $63B decline represents the largest decline in its data set going back 10 years.

#5 MONTHLY MORTGAGE: Strategas recently estimated the monthly mortgage payment set a new all-time high at ~$2,650, with the main culprits being mortgage rates still hovering near 7%, a resilient labor market, and constrained supply due to a decade of underbuilding post-housing bubble in the 2010s.


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This discussion is not intended to be a forecast of future events and should not be considered a recommendation to buy or sell any security. Past performance is not indicative of future results. Investing involves risk. Principal loss is possible. Investing in smaller companies involves additional risks such as limited liquidity and greater volatility. No current or prospective client should assume that information referenced in this communication is a recommendation to buy or sell any security or is a substitute for personalized investment advice from your individual advisor. HCM does not provide tax or legal advice. Consult your tax or legal advisor for any related questions.

All information referenced herein is from sources believed to be reliable and is provided as general market commentary and does not constitute investment advice. This material was created for informational purposes only and the opinions expressed are solely those of HCM. HCM shall not in any way be liable for claims and makes no expressed or implied representations or warranties as to the accuracy or completeness of the data and other information. The data and information are provided as of the date referenced and are subject to change without notice.

Hodges Friday Fast Five

We aim to help investors separate the news from the noise by providing our perspective. Every Friday the Hodges Capital research analysts list the five most interesting things they discovered that week. Subscribe to receive the Hodges Friday Fast Five in your inbox every Friday. 

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