Bull Sessions (12/6/2022)

Get Us Through December. Our weekly session will likely include (1) Is Apple A Good Company? (2) Santa Claus vs. Cocaine Bear, (3) Surgical Strike at Stryker, (4) Googling The "Rules" & Phoning In Royalties.

In this December 6, 2022 Bull Sessions webinar, hosts Mark Robertson and Ken Kavula discuss market conditions and investment opportunities in the current economic environment. The session opens with reflection on Pearl Harbor Day and transitions into analysis of market valuations using Value Line data, showing stocks trading at approximately 13% projected annual returns—slightly undervalued and near historical averages of 10-11% over long periods. Robertson and Kavula examine the post-COVID market bubble, housing market decline following rapid Federal Reserve rate hikes, and the inverted Treasury yield curve as indicators of sectoral recessions. They emphasize the correlation between rate increases and housing market deterioration, noting the steepness of both movements is historically significant.

A substantial portion of the discussion focuses on emerging opportunities in the financial services sector, particularly regional banks and asset management companies. Drawing on insights from retired bank examiner Ross Meredith, the speakers highlight that rising interest rates create tailwinds for banks not seen in 20 years, making this potentially the most opportune time in many investors' lifespans to purchase bank stocks. Specific companies mentioned include First Foundation (a small Southern California asset management company) and Western Alliance Bank (a regional bank expanding nationally). The hosts suggest using stock selection guides for these financial institutions, with assets serving as a proxy for sales to simplify analysis. Throughout the presentation, Robertson and Kavula maintain the educational philosophy of the Modern Investment Club Movement, emphasizing fundamental analysis and long-term buy-and-hold strategies aligned with the National Association of Investors/Better Investing methodology.