The Bottom Line 8-2

In the wake of a 25 bps cut in rates this week and a rocky market, TRG’s rock stock coverage (MLM, SUM, VMC) still saw solid gains. Stocks got a boost this week on the news of MLM earnings and gained further momentum on SUM earnings, which weren’t quite as “clean” as VMC and MLM earnings. TRG’s newest coverage company, Ferguson (LSE: FERG), was also in the news. SkyNews article published last Sunday reported that Nelson Peltz’s Trian had raised the bar, making a handful of specific requests, including 1) sell its U.K. business and 2) drop listing on the London Stock Exchange and list in the U.S. Trian had accumulated a 6% stake (valued at $911MM) by mid-June, and as TRG wrote in our initiation report (published 7/26/19), it had been reported that part of the motivation of ownership was that FERG traded at a significant discount to its U.S. peers. Finally, check out what TRG had to say on CNBC about how the ongoing trade war with China is impacting U.S. ports along the east coast – turns out the power of the expansion of the Panama Canal is more powerful.

Leisa Childers