2015 Defense Stocks Interview with Scott
Sacknoff, President, SPADE Defense Index (NYSE: ^DXS)
Point Roberts WA, NEW YORK, NY – January 22, 2015 –
( www.investorideas.com newswire and
Homelanddefensestocks.com) - Investorideas.com, a global news source covering
leading sectors including defense and security, issues a 2015 interview with Scott
Sacknoff, President of Spade Defense Index (NYSE: ^DXS).
Scott Sacknoff manages the SPADE
Defense Index (NYSE: ^DXS) which serves as the underlying index for PowerShares
Aerospace & Defense ETF (NYSE: PPA).
http://www.spadeindex.com/
Interview Q&A
Read the full interview at http://www.investorideas.com/news/2015/SPADE-defense/01221.asp
HDS: Hi, this is Dawn Van Zant
with HomelandDefenseStocks.com. We are
once again joined by Scott Sacknoff, President of the SPADE Defense Index, a
benchmark for investors interested in defense and homeland security. He will look back with us on how investors
performed in 2014, as well as give us a look ahead to what we can expect in
2015. Mr. Sacknoff, thank you for
joining us.
SMS: My pleasure Dawn.
HDS: Let’s start with 2014. How
did the sector perform?
SMS: Well instead of an eagle,
perhaps the symbol for aerospace and defense stocks should be the Energizer Bunny…as
it keeps going and going. Even the most optimistic of analysts didn’t foresee
defense stocks gaining more than 48% in 2013, and after a 4th
quarter surge in 2014, the sector’s benchmark ended 2014 with new historic
highs, gaining 11.8% for the year, roughly 40 basis points ahead of the
S&P500.
HDS: Can you tell us what drove this performance?
SMS: There were obviously a number of global
incidents around the world, most notably the conflict between Russia and the
Ukraine and the rise of ISIS in the Middle East and the threat that they
represent. One could easily look around
the world - whether it was Boko Harem in Nigeria, civil wars in Syria and
Libya, or potential threats in Iran, North Korea, the Arctic, and the seas
around China - and see conflict.
Overall, large caps dominated again, a surprise after leading the sector
for the past several years but mirroring a trend where the broader market
sought safety in large cap companies.
The returns from four of the five defense primes all significantly
outperformed the market [General Dynamics +44%, Lockheed +30%, Northrop Grumman
+29%, Raytheon +19%] with only Boeing being the laggard [It was down 5% after
an 84% gain in 2013].
HDS: Were there any other noticeable trends?
SMS: The two big trends cited over the past several
years continue, namely (1) gains in commercial aerospace, which is in the
middle of a multi-year expansion, and (2) rising international defense sales
that would offset cuts to the U.S. budget.
HDS: Skipping ahead to 2015, can
you tell us which companies or activities might perform well?
SMS: Aerospace, defense, and
security stocks should continue to be a stable place for investors as the
sector tends to have a lower correlation with the economic, currency and
political concerns economists expect in 2015.
Companies involved with defense-related IT and homeland security
activities such as cyber and big data should gain. And after several years of large caps dominating
returns, the possibility that the cycle will shift to the small and mid-caps,
as it did in the early 2000s, is gaining traction.
HDS: Lastly, in 2015, what are
some key events that investors should pay attention to?
SMS: The Paris Air Show in June
should present a number of interesting opportunities. The show is generally a showcase of
international deals related to military and commercial aircraft, rotorcraft,
UAVs and space systems, and announcements totaling $50-$100+ billion is
typical. This will likely generate some headlines for several weeks in
June. Additionally, there are some in
the new Republican controlled Congress that are seeking to end sequestration
and stabilize the defense budget through the end of the decade. The possibility
is obviously a positive. Lastly, general
economic conditions need to be monitored.
Although the sector is less correlated with the global economy than
other sectors, risk remains and short-term moves are not unexpected. Long-term, the sector has proven to offer
investors with returns that exceed the S&P500.
HDS: With a long track record of
results, are investors returning to the sector?
SMS: Many defense stocks are at
or near historic highs. The Powershares Aerospace & Defense ETF (NYSE: PPA)
hit its historic high on 26 December 2014.
And over the past 18-24 months, the assets managed by ETFs have tripled
from its lows when some thought major defense cuts were inevitable. Still in
terms of shares outstanding, the funds are well below their peak, implying
investors have returned but there is still significant room for growth. As it becomes more difficult for investors to
pick and choose the winners in the sector and rotate among them, the ETFs tend
to become more attractive and in turn attract more investors.
HDS: Scott, thank you for taking
some time with us today.
InvestorIdeas.com newswire is a global recognized news source. We publish
original content, third party investment commentary, contributor articles,
company news and press releases in leading sectors.
Sectors we cover in include
mining, energy, renewable energy, water stocks, food and beverage (including
organic and LOHAS, wine), defense and security, biotech, technology and mobile.
We have also recently expanded our global coverage to include Latin American
stocks, sports and entertainment.
Sign up for free news alerts at
Investorideas.com
Become an Investorideas.com Member and access our online stock directories
listing thousands of publicly traded stocks in leading sectors
Spade Defense Index Disclaimer:
The information presented here is for information purposes only and
should not represent a solicitation or an offer to purchase an investment
product.
Disclaimer/ Disclosure: The
Investorideas.com newswire is a third party publisher of news and research as
well as creates original content as a news source. Original content created by
investorideas is protected by copyright laws other than syndication rights.
Investorideas is a news source on Google news
and syndication partners. Our site does not make recommendations for
purchases or sale of stocks or products. Nothing on our sites should be
construed as an offer or solicitation to buy or sell products or securities.
All investment involves risk and possible loss of investment. This site is
currently compensated by featured companies, news submissions, content
marketing and online advertising. Contact each company directly for press
release questions. Disclosure is posted on each release if required but
otherwise the news was not compensated for and is published for the sole
interest of our readers. More disclaimer info: http://www.investorideas.com/About/Disclaimer.asp
BC Residents and Investor
Disclaimer : Effective September 15 2008 - all BC investors should review all
OTC and Pink sheet listed companies for adherence in new disclosure filings and
filing appropriate documents with Sedar. Read for more info: http://www.bcsc.bc.ca/release.aspx?id=6894.
Global investors must adhere to regulations of each country.
Contact Investorideas.com
800 665 0411
No comments:
Post a Comment