Growth, Value, and Dividends
When panning across the US styles screen of our Trend Analyzer tool, one dynamic has become clear over the past week: growth has trumped value. Across the board, most ETFs in this screen are overbought as of yesterday’s close trading a full standard deviation or more above their respective 50-DMAs. However, it is growth oriented ones that have gotten the most extended thanks to outsized year-to-date in addition to 5-day gains. While those growth ETFs like the Vanguard Growth ETF (VUG) have risen to new highs, value and dividend ETFs have mostly pulled back in the short term.
Taking a sample using the Vanguard family of ETFs, again growth (VUG) is the top performer in the past week and this year while value (VTV) is closer to the bottom of the list. Meanwhile, the Vanguard Dividend Appreciation ETF (VIG) has likewise fallen in the past week albeit by a more modest amount. As shown below, the relative strength lines of growth versus value and dividends have tracked one another closely this year. In both scenarios, growth has outperformed value and dividends throughout most of 2024 with a notable swing higher since early last week.
Impressively, that favoritism towards growth in the past week has been historic. Below we show the rolling 5-day relative strength of growth (VUG) versus dividends (VIG) going back to 2006 when the Vanguard Dividend Appreciation ETF (VIG) first began trading. That current short-term stretch of relative strength in growth ranks as one of the most dramatic on record. The last time there was more than 4 percentage points of outperformance in growth versus dividends was over a year ago in the spring of 2023. Looking back further, there have been multiple other comparable instances since the COVID crash, but there are zero examples before 2020.
For value, that relative weakness versus growth is again at historic levels for a one-week span. There has been a five percentage point difference between the two over the past week. As with growth versus dividends, that is the widest degree of outperformance since the spring of 2023 with many other occurrences since early 2020. One difference, however, is that there are also a couple of examples to draw from back during the Financial Crisis years (the first in October 2008 and the second in March 2009).
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The Bespoke 50 Growth Stocks — 12/5/24
The “Bespoke 50” is a basket of noteworthy growth stocks in the Russell 3,000. To make the list, a stock must have strong earnings growth prospects along with an attractive price chart based on Bespoke’s analysis. There were 8 changes to the list this week.
The Bespoke 50 is available with a Bespoke Premium subscription or a Bespoke Institutional subscription. With Bespoke Premium, you’ll receive a number of daily market updates from us along with our weekly newsletter and a portion of our investor tools. With Bespoke Institutional, you’ll receive everything that’s included with Premium plus additional daily macro analysis and more stock-specific research.
To see all 50 stocks that currently make up the Bespoke 50, simply start a two-week trial to Bespoke Premium or Bespoke Institutional.
The Bespoke 50 performance chart shown does not represent actual investment results. The Bespoke 50 is updated monthly on Thursdays unless otherwise noted. Performance is based on equally weighting each of the 50 stocks (2% each) and is calculated using each stock’s opening price as of Friday morning after publication. Entry prices and exit prices used for stocks that are added or removed from the Bespoke 50 are based on Friday’s opening price. Any potential commissions, brokerage fees, or dividends are not included in the Bespoke 50 performance calculation, but the performance shown is net of a hypothetical annual advisory fee of 0.85%. Performance tracking for the Bespoke 50 and the Russell 3,000 total return index begins on March 5th, 2012 when the Bespoke 50 was first published. Past performance is not a guarantee of future results. The Bespoke 50 is meant to be an idea generator for investors and not a recommendation to buy or sell any specific securities. It is not personalized advice because it in no way takes into account an investor’s individual needs. As always, investors should conduct their own research when buying or selling individual securities. Click here to read our full disclosure on hypothetical performance tracking. Bespoke representatives or wealth management clients may have positions in securities discussed or mentioned in its published content.
Chart of the Day – Williams Cos (WMB)
Bespoke’s Morning Lineup – 12/5/24 – Do You Believe?
See what’s driving market performance around the world in today’s Morning Lineup. Bespoke’s Morning Lineup is the best way to start your trading day. Read it now by starting a two-week trial to Bespoke Premium. CLICK HERE to learn more and start your trial.
“If you don’t believe me or don’t get it, I don’t have time to try to convince you, sorry.” ― Satoshi
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
As we type this, futures on the S&P 500 and Nasdaq are down 0.01% while Dow futures are unchanged. This comes after all three indices hit record highs yesterday. On the economic calendar, initial jobless claims came in modestly higher than expected while continuing claims fell back below 1.90 million to 1.871 million
In Asia, the Nikkei was modestly higher as expectations for a December rate hike were dialed back following comments from a BoJ official saying that he expects inflation to fall back below the 2% target in 2025 as he sees wage growth slowing down. In South Korea, President Yoon is expected to be the subject of an impeachment vote over the weekend, and Q3 GDP came in weaker than expected rising by just 0.1% compared to expectations for growth of 0.5%.
In Europe this morning, equities are trading modestly higher as the market increasingly expects the ECB to cut rates at its policy meeting next week as October Retail Sales for the region fell more than expected (-0.5% vs -0.4%).
It’s hard to believe that the election was only a month ago today, and it’s equally hard to believe the move in Bitcoin during that time. After closing just above $69,000 on Election Day, overnight the world’s largest cryptocurrency topped $100,000 for the first time, and this morning those gains have continued as it trades right around $103K. In a month, Bitcoin has rallied nearly 50%. In terms of market cap, that works out to more than $400 billion! While all three major US equity indices hit all-time highs yesterday, Bitcoin saw those gains and one-upped the equity market overnight.
We’ve shown versions of the chart below numerous times over the last few weeks, but the cup-and-handle breakout formation in Bitcoin is textbook.
While Bitcoin has been hitting record highs for the last couple of weeks now, last night’s move was notable for another reason besides crossing $100K for the first time. In yesterday’s DealBook conference, Fed Chair Powell referred to Bitcoin as “just like gold only it’s digital”. The chart below shows the historical ratio of Bitcoin to an ounce of gold. The last peak in this ratio occurred in November 2021, but with yesterday’s move above $100K, the ratio between digital and physical gold also broke out to a new record high. Just like Powell, investors increasingly appear to view Bitcoin as a digital version of gold, that’s a lot easier to store and move around.
The Closer – Metro GDP, CFO Optimism, Ford Sales – 12/4/24
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Looking for deeper insight into markets? In tonight’s Closer sent to Bespoke Institutional clients, we lead off with a review of the latest metro level GDP data in addition to an update of our Beige Book index (pages 1 and 2). When then review the latest PMI data (page 3) and Duke CFO survey (page 4). We close out with rundowns of the latest monthly Ford (F) sales figures (page 5) and petroleum stockpile data (page 6).
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Chart of the Day: Two Years of ChatGPT and AI
Q3 2024 Earnings Conference Call Recaps: Dollar Tree (DLTR)
Bespoke’s Conference Call Recaps use AI to summarize lengthy earnings calls. The commentary below is AI-generated and then edited by Bespoke for quality control. As always, none of these summaries should be construed as recommendations to buy or sell any securities, and investors should do their own research and/or consult with a financial professional before making any investment decisions.
Our latest recap available to Bespoke subscribers covers Dollar Tree’s (DLTR) Q3 2024 earnings call.
Dollar Tree (DLTR) operates a network of discount retail stores under the Dollar Tree and Family Dollar banners. The stores provide everything from household essentials and groceries to seasonal and discretionary items, with a focus on value and affordability. DLTR’s unique multi-price format, offering items primarily at $1.25, and Family Dollar’s expanded assortment cater to customers stretching their budgets. The company’s store network offers insights into consumer behavior, particularly among low- to middle-income households during economic shifts. This quarter, DLTR reported a sequential improvement in comps, with multi-price 3.0 stores contributing 30% of DLTR’s Q3 net sales. Converted stores posted a 3.3% comp, supported by a 6.6% consumables comp. Consumer behavior reflected economic pressures, with increased focus on “buying for need,” boosting consumables sales. Family Dollar showed progress in discretionary categories, achieving its first positive comp since 2022. Holiday sales are poised for growth despite fewer shopping days, with an expanded seasonal assortment. The company continues a strategic review of Family Dollar, exploring sale or spinoff options. After last quarter’s poor results that sent shares tumbling 22%, better-than-expected results this quarter boosted the stock modestly at the open on 12/4…
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Biggest Winners and Losers Since the Election
It’s been nearly a month now since the Presidential election, and from the close on 11/5 through yesterday (11/3), 354 (71%) stocks in the S&P 500 have experienced gains and the average performance of all 500 stocks in the index has been a gain of 3.89%. Of the ones that have rallied since the election, 13 have posted gains of at least 20%, and we have listed each one below with one-year price charts below that. Of the 13 biggest winners, most of them were already big winners leading up to the election, and all but four are currently up over 40% YTD. Looking at the charts, it’s also worth noting that the only four that experienced reversals in their trends around the election were EPAM Systems (EPAM), Super Micro Computer (SMCI), Tesla (TSLA), and Warner Brothers Discovery (WBD). In most cases, the reason for these reversals had little to do with the election and were more company-specific events. EPAM and WBD both reported earnings two days after the election, and SMCI had news related to hiring a new auditor. Tesla (TSLA) is the only stock that really saw a notable shift in its trend due to the election, and given CEO Elon Musk’s role as the right-hand man to President-Elect Trump, that move is understandable.
Turning to the losers, only 12 stocks in the S&P 500 were down 10% or more between 11/5 and the close yesterday (12/3). Unlike the list of biggest winners, though, some of these names, especially in the Health Care sector, were in steady uptrends ahead of the election but have seen those rallies reverse. Shares of Leidos (LDOS) were also at 52-week highs just after the election but have plunged since, as Vivek Ramaswamy has discussed the large amounts of bloat in funding for federal contractors. In several cases, though, the declines have been company-specific.
Finally, within the “Trillion-Dollar Club”, most have seen gains but to varying degrees. Leading the way higher, TSLA has rallied nearly 40% (Elon’s bet really paid off!), and next on the list is Apple (AAPL) with a gain of 8.6%. There’s been a lot of talk about Mark Zuckerberg not being welcomed at Mar-a-Lago, but it hasn’t impacted the stock of Meta Platforms (META) as it has rallied 7.2%. Behind META, the other members of the “Trillion-Dollar Club” that have outperformed the S&P 500 are Amazon.com (AMZN), Berkshire Hathaway (BRK/B), and Microsoft (MSFT), which have rallied 7.0%, 5.7%, and 4.8%, respectively. That leaves Alphabet (GOOGL) and Nvidia (NVDA) as the only two members of that club that have underperformed the S&P 500 since the election.
As with anything, it’s tempting to look at these recent performance numbers and extrapolate the out or under-performance throughout the entire Trump Administration, but remember that it hasn’t even been a month yet, so expect a lot of changes along the way.
Q3 2024 Earnings Conference Call Recaps: Salesforce (CRM)
Bespoke’s Conference Call Recaps use AI to summarize lengthy earnings calls. The commentary below is AI-generated and then edited by Bespoke for quality control. As always, none of these summaries should be construed as recommendations to buy or sell any securities, and investors should do their own research and/or consult with a financial professional before making any investment decisions.
Our latest recap available to Bespoke subscribers covers Salesforce’s (CRM) Q3 2025 earnings call.
Salesforce (CRM) is a global leader in customer relationship management (CRM) software, offering a comprehensive platform that integrates sales, service, marketing, commerce, analytics, and more. Powered by AI and data-driven insights, CRM helps businesses automate workflows, engage customers, and optimize operations. With its pioneering Agentforce platform, CRM is at the forefront of digital labor and AI transformation, showcasing how AI can revolutionize productivity across industries. This quarter, CRM highlighted the rapid adoption of Agentforce, its AI-powered digital labor platform, with over 200 deals closed since its October launch. The company reported $9.44 billion in revenue, up 8% YoY, with Data Cloud integrated into eight of its top ten deals. CEO Marc Benioff emphasized Agentforce’s scalability, projecting it could deflect 25%-50% of human service cases. The upcoming launch of Agentforce 2.0 was teased as a game-changer. Strong multi-cloud demand and international expansion also stood out, driving resilience in key industries like healthcare and manufacturing. CRM opened 10% higher on 12/4 on new excitement around digital labor, despite a miss on the bottom line…
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Bespoke’s Morning Lineup – 12/4/24 – A Perfect After Hours Session
See what’s driving market performance around the world in today’s Morning Lineup. Bespoke’s Morning Lineup is the best way to start your trading day. Read it now by starting a two-week trial to Bespoke Premium. CLICK HERE to learn more and start your trial.
“If I read as many books as most men do, I would be as dull-witted as they are.” – Thomas Hobbes
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
Markets are looking to start the day positively with several key economic reports and Fed speakers. The ADP Employment report just hit the tape and came in modestly weaker than forecasts. Still coming up, we have the ISM Services report at 10 AM which is expected to fall slightly from 56.0 down to 55.6. Besides the economic data, we’ll also get the Beige book at 2 PM Eastern and some Fed speakers, including the Chair himself who will appear at the Dealbook Summit at 1:45 Eastern.
There’s a lot of important economic and Fed-related data for the market to navigate today. Still, bulls can only hope that the news comes in as positive as yesterday’s earnings reports after the close. As mentioned in yesterday’s email, Salesforce (CRM) was the big report of the after-hours session. While expectations were already high, the stock exceeded the bar trading 13% higher in the pre-market. That puts it on pace for the largest upside gap in reaction to earnings since March 2023. If the gains hold through the end of the session, it would be the best one-day reaction to earnings since August 2020.
CRM may be a company with a market cap of $350 billion, but regarding earnings, it’s extremely volatile. Historically, the stock’s average one-day change in reaction to earnings has been nearly 7%, but as shown in the chart below, two of its last three reports have been followed by double-digit percentage moves in reaction to earnings. Typically, you expect stocks to become less volatile in reaction to earnings as they become larger, but as CRM and other mega-cap stocks have illustrated in recent quarters, that doesn’t always seem to be the case.
We showed this chart yesterday, but we wanted to update it to include yesterday and today. Provided CRM doesn’t reverse course and trade sharply lower on the session, today will be the 54th day in a row that the stock has closed at overbought levels (1+ standard deviations above 50-DMA). That’s already easily a record high, but with CRM trading 2.8 standard deviations above its 50-DMA this morning, there’s the potential for this streak to extend several more days.
What makes yesterday’s after-hours earnings news even more impressive is that CRM’s surge was relatively modest. Of the four companies that reported after the close with sales of $500 million or more, CRM is trading up the least and is the only one that didn’t report an earnings triple play! As shown in the table, Marvell (MRVL) and Okta (OKTA) are both up slightly more in the pre-market, and Pure Storage (PSTG) is trading up over 20%. It’s hard to remember another time when four mid-to-large companies reported earnings after-hours and they traded up at least 10%. Looking at how these companies traded heading into earnings, it’s not as though they hadn’t rallied into their earnings reports. As of yesterday’s close, all four were above their 50 DMAs, three were at overbought levels, and two were up over 50%!
