Key Investor Debates Likely to Drive Stocks in the Upcoming Year
We are well into the third year of macro. Debates around the outlook
of different economies and asset classes continue to dominate
investors’ agendas and the movements of individual securities
across regions and sectors.
Our global team of economists and strategists is focused on these
key debates, expectations, and risk-reward scenarios (for their latest
risk-reward views, please consult the Global Debates Playbook
monthly and their special year-end publications).
In this series, Big Debates: 2011, our industry analysts around the
globe look at the industry- and company-specific investor debates
that are likely to drive stocks in the upcoming year. We looked for
debates that are likely to matter, that are likely to be settled (or
significantly advanced) in the coming year, and for which we have a
view that differs sharply from the current market view.
Our job as securities analysts starts with conversations with leading
investors. We look to identify which debates matter today, and more
important, which will matter tomorrow. Through these conversations,
along with an increasing array of analytics, we also get a read for
“what’s in the price” – what are the types of expectations that may
warrant the current price.
As always, we look forward to your feedback.
Linda Riefler
Global Head of Research
Juan-Luis Perez
Global Director of Research
Agricultural Commodities & Equities ................. 2
With the Chinese Outlook Now Uncertain, Have
Prices Peaked? (CF and SAFM)
AMR Corp. ............................................................ 4
Can Stronger for Longer Mid-Cycle Margins
Drive Upside in Legacy Laggard?
Autos & Auto Related .......................................... 6
Can SAAR Recover Sharply in 2011?
(F and BWA)
Banks, Large-Cap................................................. 8
Will Capital Management Drive Bank Stocks
Upward in 2011? (BAC, PNC, WFC)
Caterpillar ............................................................. 10
Will Production Improvements Mean CAT Earns
$8-10 This Cycle?
CBS Corporation.................................................. 12
Return to Peak EPS?
Chemicals............................................................. 14
Petrochemical Margins – Imminent Decline or
Supercycle? (LYB and DOW)
Coach, Inc............................................................. 16
Can China Move the Needle?
Dell ........................................................................ 18
How Vulnerable Is Dell to Moderating PC and
Server Growth?
Intuit ...................................................................... 20
Can Intuit’s Secular Story Further Accelerate
after a Strong 2010?
Cable/Satellite; Media .......................................... 22
Will ‘Over the Top’ Video Providers Begin to
Take Meaningful Share in 2011? (DISH, DTV)
Motorola................................................................ 24
Is Motorola Worth More Split in Two Pieces than
Combined?
Murphy Oil ............................................................ 26
Will Refining Asset Sales and Exploration Drive
a Re-rating?
Oil Services, Drilling & Equipment ..................... 28
Oil Services Sub-Sector Sector Poised to
Accelerate during 2011? (WFT, SLB)
VMware Inc ........................................................... 30
Can VMware Grow Despite Slowing x86 Server
Growth in C2011?
The Williams Companies..................................... 32
How Probable Is a Breakup?
Valuation Methodology and Risks ...................... 34