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

#1 MORE COLD BREW PLEASE: Cold brew coffee servings increased 27% to 373 million in the 12 months ended April according to NPD/CREST. Servings of iced coffee remained the category leader at 2.8 billion servings growing 11% YOY.

#2 APPAREL/ FOOTWEAR: Wedbush Securities recently ran a survey of over 750 U.S. consumers to gauge sentiment given the current macro environment, as well as near-term spending plans. Surprisingly, they’re still planning to grow their apparel/ footwear spending in the near-term with 65% of individuals planning to spend more and only 19% who plan to spend less.

#3 ORANGE METAL SUPPLY: Based on data provided by Jefferies International, the major copper miners that have reported second-quarter represent 59% of global copper supply, and results have produced a combined 87.3kt of copper to represent a year-over-year decline of 0.5%. This data confirms antidotal evidence that while copper prices have been volatile this year, the physical supply for copper remains rational relative to demand.

#4 FUND FLOWS: Per Deutsche Bank, flows to equity funds flipped positive this past week ($5.6bn) following five consecutive weeks of outflows. Net equity inflows were driven by strong inflows to the US ($9.5bn), while Europe (-$3.6bn) continued to witness heavy redemptions and flows to other regions were modest.

#5 EARNINGS SEASON: According to Truist Securities, ~73% of S&P 500 reporting companies have surprised on EPS and 66% have reported revenue beats. If these figures hold, it would be the worst performance since 1Q20 and 2Q20 respectively.

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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.

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