Industrials

Report by Kailash Capital Research

Kailash Capital Research argues that midcap allocations have shrunk to an unprecedented 19.4% of the Russell 1000, setting a fresh six-decade low beneath the dot.com trough. Although the relative trade lagged by 3.6% since year-end 2024 (Russell 1000 up 32.3% vs. 28.7% for midcaps), valuation spreads have stretched right back to dot.com peak extremes. The Russell 1000 trades at 3.3x sales (the 99.9th percentile historically) versus 1.7x for midcaps, leaving the relative price-to-sales multiple at 1.9x. Crucially, the largest 50 stocks trade at 6.0x sales, matching the dot.com record of 3.5x the midcap sales multiple. Sector concentration has also intensified, with IT expanding to 36% of the large-cap benchmark, whereas midcaps offer broader US economic exposure led by Industrials at 17%. Kailash Capital Research reiterates funding midcaps by trimming mega caps, ranking AES Corp (AES), Cheniere Energy Inc (LNG), Popular Inc (BPOP), Axis Capital Holdings Ltd (AXS), and Halliburton Co (HAL) at the top of their 25-stock screen.

Technology

Report by Sales Pulse Research

Sales Pulse has received multiple reports from channel contacts indicating that NOW has initiated a significant workforce reduction this week. While the company has not yet publicly disclosed the scope of the restructuring, employee reports and internal discussions suggest ~2,500 employees may be impacted (8% of the workforce). The cuts have impacted multiple organisations, including sales (AEs and Solution Consultants), international operations and engineering teams. The move has surprised employees and observers given recent commentary from the CEO suggesting AI-driven productivity gains and natural attrition would manage headcount. Channel feedback has been notably negative, with one contact saying the process is “creating chaos internally” and that the company has become “so top heavy” it is struggling to execute.

Report by Belkin Report

While Utilities outperformance is being attributed to greater energy demands of AI and EVs, many “boring” electric utilities without obvious AI potential are up DD % over the last few months (AES, Dominion Energy, PSEG). Furthermore, Consumer Staples has an early outperform forecast in Michael Belkin's proprietary times series analysis model - another risk-off signal. The AI and Tech obsession obscures a bigger trend: many Tech stocks are declining. The CLOU cloud software ETF is down -15% since early Feb. Former leading new-era disruptors are top Sell recommendations (Uber, Meta, Netflix). Even Nvidia remains a Sell and its biggest risk is something nobody is talking about: its chips are made in Taiwan.