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

#1 WINDOW VISIBILITY: A recent homebuilder survey conducted by John Burns Real Estate Consulting cited that windows are the most significant material shortages causing project delays. With 63% of builders identifying windows as their largest challenge, average lead times range from 4-15 weeks. Before the pandemic, lead times were typically 2-3 weeks.    

#2 ANCHORS AWAY: Recent reports from a leading national boat retailer have suggested that boat demand remains strong relative to supply. Furthermore, the supply of new recreational boats is unlikely to improve until late 2022.  

#3 GREEN STEEL PRODUCTION: According to data provided by Worldsteel, 42% of US flat-rolled steel production now utilizes electric arc furnaces (EAF) compared to 1% in 1990. EAF steel production has increased the demand for prime grade scrap metal mainly produced from manufacturing and has seen a decline in supply in recent years.

#4 MATTRESS RETAIL: After a strong Labor Day sale period for the mattress industry, recent Google search volume for most mattress brands has slowed over the past month. However, search results remain elevated for one of the leading premium mattress brands, suggesting a recent possible market share shift.

#5 APPLIANCE CYCLE: With an installed base on connected appliances becoming more prevalent, a leading North American appliance manufacturer has recently indicated that its data suggests that consumers are using appliances such as wall ovens, freestanding ranges, and washing machines far more often than before the pandemic. Elevated usage of appliances could ultimately drive shorter replacement cycles.

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