Global Insight Weekly - RBC Wealth Management USA

Global Insight Weekly - RBC Wealth Management USA

R B C W E A LT H M A N A G E M E N T
GLOBAL INSIGHT
W E E K L Y
MARCH 6, 2015
A C LO S E R LO O K
Low Inflation of Low Concern
Tom Garretson – Minneapolis
Low inflation levels—and in some cases, negative inflation rates—continue to hover over markets, but
as the risk of outright deflation remains low, so does the risk of excessive inflation. This is actually good
news for fixed income investors.
U.S. consumer prices recently posted the first annual decline
since the financial crisis and only the second negative reading
since the 1950s (see chart). The eurozone, Japan, and China
have seen similar price activity—the overall trend was up
for many decades, but inflation rates have been quite low or
negative recently.
Because prices normally rise, inflation is a familiar concept for
many. Deflation and disinflation may be less so.
Deflation is generally defined as a sustained period of broadbased annual price declines that can cause consumers to delay
purchases, on expectations that future prices will be lower.
This in turn leads to further prices declines—a vicious cycle
that central banks and governments seek to avoid at all costs
because it can crater the economy and asset prices.
Disinflation is a decrease in the rate of inflation. Prices still
rise, but not as much. It is often exacerbated by pricing
pressure in one sector, which is what some countries are
witnessing now from the collapse in global energy prices.
Annual Change in U.S. Consumer Prices Since 1914
25
20
15
10
5
0
-5
-10
-15
-20
-25
1914
+1.6%
-0.1%
Consumer Price Index
Core Consumer Price Index: Ex-Food & Energy
1934
1954
1974
1994
2014
Source - RBC Wealth Management, Bloomberg
M A R K ET P U L S E
Room to Breathe
3
Why we still like U.S. financials as a portfolio stalwart
If the objective of many governments and central banks is
price stability, why don’t they target 0% inflation? Why is 0%
inflation so unwelcomed?
3
Surprises at Canada’s wireless spectrum auction
4
ECB upbeat on growth, but warns against complacency
By targeting a higher rate, such as 2%, it gives officials room
to implement monetary policy, anchors expectations of price
growth in the minds of consumers and producers, and creates
4
China’s State Council to step up fiscal policy support
Click here for authors’ contact information. Priced as of 3/6/15 market close,
EST (unless otherwise noted). All values in USD unless otherwise noted.
For Important and Required Non-U.S. Analyst Disclosures, see page 6.
a “cushion” during recessionary periods. If prices were growing
at 0%, a recessionary period could easily drive prices into a
deflationary spiral. But if price growth has been above zero,
then central banks will have room to ease policy and lower
interest rates, and potentially avoid deflationary cycles, against
which they have few tools and little experience fighting.
will succeed in this effort, and it will show up in the numbers as
energy prices stabilize and then improve. At the same time, risk
of excessive inflation that would erode fixed income returns still
seems a long way off as the path toward inflation targets will
likely be a multiyear process.
Bond Investors Rejoice
Current Inflation Levels Relative to Inflation Objectives
For fixed income investors, this is a win-win scenario.
Central bankers will remain laser-focused on avoiding outright
deflation that could harm the global economy. We think they
U.S.
Japan
U.K.
Inflation Target
Eurozone
China
While the Fed is on the cusp of tightening monetary policy, many
global central banks, including China, Japan, and Europe, are
still easing, and are likely to do so until price objectives are met.
Core CPI
Canada
In the U.S., the Federal Reserve has missed its 2% inflation target
for 46 of the past 49 months. Chinese producer prices, or the cost
of goods manufactured there, have been negative since 2012.
Add to that, the government recently lowered its GDP growth
and inflation targets, both of which should pressure global prices
lower.
CPI
3.5%
3.0%
2.5%
2.0%
1.5%
1.0%
0.5%
0.0%
-0.5%
Australia
As the chart shows, nearly all developed nations are missing
inflation objectives, and in many cases, have been for some time.
Note: Inflation targets represent mid-range of either the Central Bank’s or Government’s
objective. Japan data adjusted for sales tax hike.
Source - RBC Wealth Management, Bloomberg, Central Bank Data
WWHHATAT’ S’ SMMOOV VI NI NGGMMA AR RK KETETS S
Deals, Deals, and More Deals
Merger and acquisition (M&A) deals continue to move segments
of the equity market. During the week, Netherlands-based NXP
Semiconductors agreed to acquire U.S.-based Freescale in order
to make a bigger push into the burgeoning global automotive
semiconductor industry. In health care, pharmaceutical
company AbbVie said it will buy biotech firm Pharmacyclics for
its blood cancer treatment, which could be a blockbuster.
Global M&A volume in semiconductors, software, and
pharmaceuticals is up 90%–125% in the past three months on
a year-over-year basis. It’s also been solid in the last six months.
But biotech is nearly off the charts with 3-month global activity
running 626% higher than the previous year, and even stronger
in the U.S. and Asia (see chart).
We believe these industries will continue to be active due
to reasonable valuations, solid growth prospects, and much
sought-after innovations by acquirers. The energy sector is
also likely to see heightened deal activity this year due to the
shakeout caused by the crude oil collapse.
Biotech M&A Volume Has Spiked Recently
3-month Industry Merger & Acquisition Volume Growth by Region (% change y/y)
100%+ y/y M&A volume growth in most
software, semi, and pharma segments is
actually a healthy rate. But, it looks puny
compared to the surge in biotech volume,
which is nearly off the charts.
Global
U.S.
Europe
626
Asia Pacific
154
125 106 120 125 105 103
90
0
0
-7
Software
826
780
-56 -22
Semiconductors Pharmaceuticals
Biotech
Source - RBC Wealth Management, Bloomberg; data from 12/1/14 – 3/5/15
Cheap money, and in some cases nearly free money, is boosting
M&A volume as major central banks maintain ultra-low interest
rate policies. This reinforces our positive stance on global
equities.
GLOBAL INSIGHT WEEKLY
March 6, 2015
2
■
■
■
■
On March 11, the Fed will authorize banks’ plans for share
buybacks and dividend payments. RBC Capital Markets’
analysts believe most will be approved, but a few banks
may see their proposals curtailed.
We continue to recommend investors hold an overweight
position in U.S. financials. Bank stocks still appear
reasonably valued, and loan growth should improve as the
economy strengthens. They should perform well ahead
of the first rate hike and in the early stages of the Fed’s
tightening cycle as net interest margins finally rise. Ultralow rates have been a lead weight on banks’ profits.
Economic data was mixed during the week. On the plus
side, the U.S. created far more jobs in February than
economists had expected (295,000 nonfarm payrolls vs.
235,000 consensus forecast), which brought the four-month
total to an impressive 1.29 million jobs. But wage growth
fell shy of expectations again (0.1% m/m, 2.0% y/y), and
the labor participation rate dipped to 62.8%.
The manufacturing sector lost more momentum as the
ISM measure fell to 52.9 in February from 53.5. Many of
the survey’s participants said the prolonged West Coast
port strike negatively affected volumes. Because the port
disruptions have ended, RBC Capital Markets’ chief U.S.
economist believes manufacturing activity will be much
more robust in coming months.
CANADA
Patrick McAllister & Eric Lafortune – Toronto
■
The S&P/TSX Composite declined modestly as the
materials sector lagged. Shares in gold producers retreated
sharply as the price of bullion fell.
GLOBAL INSIGHT WEEKLY
2015 Consensus Earnings Growth Forecasts
16.1%
11.4%
7.6% 6.9% 6.2%
5.2% 4.1%
2.2% 1.7% 1.2%
Energy
Utilities
S&P 500
Cons. Staples
Materials
Telecom
Industrials
-55.0%
Technology
The S&P 500 fell 1.6% for the week as the market continued
to consolidate February’s outsized gains. All 10 sectors
traded lower. Within financials, banks and brokerages
outperformed, rising 1.0% and 0.8%, respectively. The
Federal Reserve’s annual stress test results showed all
financial institutions examined passed the minimum
capital requirements for the first time since the tests began
in 2009. The U.S. financial system continues to regain
strength, is adequately capitalized, and could weather an
economic shock, the quantitative measures indicated.
Bank of America’s results noticeably improved versus last
year. There were weak spots, however, as Goldman Sachs
and Zions Bancorporation barely exceeded key capital
minimums.
Health Care
■
Cons. Disc.
Kelly Bogdanov – San Francisco
Financials Sector Expected to
Post the Strongest Earnings Growth
Financials
U N I T E D S T AT E S
Source - RBC Wealth Management, Thomson Reuters I/B/E/S; data on 3/5/15
■
Canadian banks finished reporting Q1 results, which
generally overshot consensus expectations. The impact
of depressed energy prices was muted, but we expect it
will become a headwind as the year progresses. The banks
continue to trade near their long-term historical earnings
multiple despite analyst expectations for modest earnings
growth.
■
Industry Canada announced the results of the latest
wireless spectrum auction. Telus surprised by spending
more than RBC Capital Markets expected, while Rogers
Communications did not succeed in acquiring any new
spectrum.
■
Government of Canada bond yields finished 15–24 basis
points (bps) higher over the week following a neutral policy
statement from the Bank of Canada (BoC) that said the
“risks around the inflation profile are more balanced” since
the January 21 meeting. The market had been pricing in an
additional rate cut over the next six months. We think this
report buys the BoC some time to assess the impact of its
most recent rate cut on the economy.
■
The Canadian dollar declined by approximately CA$0.02
on Friday following a strong U.S. jobs report and weak
Canadian trade figures.
■
The S&P/TSX Canadian Preferred Share Total Return
Index finished up by around 0.60% on the week as a 24-bps
move higher in 5-year Government of Canada bond yields
has helped a number of discounted rate-reset preferred
shares post price gains.
March 6, 2015
3
EUROPE
Frédérique Carrier & Davide Boglietti – London
■
■
■
■
Further Easing by the PBoC as
Lending and Deposit Rates Are Lowered
8
While the euro continued to weaken, the STOXX 600 eked
out gains of 0.5% for the week. The index is approaching the
technically important 480 level the market peaked at in 2000
and 2007.
7
The week’s news was dominated by the European Central
Bank (ECB), which was supposed to announce details of
its quantitative easing programme. The ECB argued that
the anticipation of the programme has already had an
effect on markets, most obviously through the euro, which
has weakened more than 20% against the dollar over the
past six months. Moreover, since the announcement of the
programme in January, inflation expectations have started
to turn around. Peripheral spreads and absolute yields
continue to tighten substantially which, in combination
with the pick-up in inflation expectations, has led to a
substantial drop in peripheral real yields.
4
The ECB unveiled sanguine staff projections, much
improved over its December scenario. It now expects 1.5%
growth this year (versus the 1.0% prior expectation), 1.9%
next year (prior 1.5%), and introduced a 2.1% 2017 forecast.
Lower oil prices, a weaker euro in trade-weighted terms,
and the effect of previous monetary policy interventions
were all mentioned as the cause for optimism. Inflation
expectations were also sharply increased.
ECB President Mario Draghi cautioned against national
governments’ complacency, urging for more fiscal and
structural reforms. He stressed the QE programme would
be open-ended despite the more upbeat outlook as several
months are needed before the Governing Council can
evaluate QE’s impact.
6
5
2
1
0
2008
GLOBAL INSIGHT WEEKLY
2009
2010
2011
2012
2013
2014
2015
Source - RBC Wealth Management, Bloomberg
the dollar. RBC Capital Markets has a non-consensus call for
further yuan depreciation against the dollar.
■
On balance, the rate cut is positive for Chinese bank
stocks, in our view. Although it negatively impacts lending
margins, it is supportive of asset quality and, therefore,
bank valuations. However, while the timing of the cut
was uncertain, it was expected at some juncture. Equity
reaction was muted.
■
Policy flexibility in China has risen due to disinflation,
although authorities have also noted the threat of deflation,
a common global theme. January CPI fell below 1%—the
first time since November 2009. The State Council and
Premier Li Keqiang both stated that there is also a need
for more fiscal support for the economy, particularly the
property market, which has been weak in recent months.
■
During the National People’s Congress (NPC), the Chinese
government lowered the 2015 GDP growth target to
“around 7%,” as expected by the market. The upper limit for
inflation was set at 3%, but this is unlikely to be tested. The
target for growth in money supply (M2) is 12%, down from
13%. The fiscal budget deficit target was moved moderately
higher to 2.3% of GDP from 2.1%. There were no major
surprises in the targets.
■
Japanese equities reached new cycle highs again as the yen
weakened to over USDJPY120. At 1,540, the TOPIX index
has risen by 7.5% thus far this year and may consolidate in
the short term, in our view. We maintain over overweight
position in the longer term, however.
Jay Roberts – Hong Kong
The People’s Bank of China cut benchmark interest rates
for the second time since November. The one-year lending
rate was cut by 25 basis points (bps) to 5.35%. The one-year
deposit rate was lowered by 25 bps to 2.5%. This followed
a recent reduction in the reserve-requirement ratio (RRR).
Consensus forecasts call for further reductions in the RRR
this year of 50 bps. The yuan weakened modestly against
PBoC cuts lending and
deposit rates by 0.25%
3
A S I A PA C I F I C
■
PBoC 1-Year Lending Rate
PBoC 1-Year Deposit Rate
March 6, 2015
4
M A R K ET S C O R E C A R D
Data as of March 6, 2015
Equities (local currency)
S&P 500
Dow Industrials (DJIA)
NASDAQ
Russell 2000
Level
1 Week
MTD
YTD
12 Mos
Govt Bonds (bps chg)
Yield
1 Week
10.3%
U.S. 2-Yr Tsy
0.721%
10.3
10.3
2,071.26
-1.6%
-1.6%
0.6%
17,856.78
-1.5%
-1.5%
0.2%
8.7%
U.S. 10-Yr Tsy
2.245%
25.2
4,927.37
-0.7%
-0.7%
4.0%
13.2%
Canada 2-Yr
0.627%
15.5
MTD
YTD
12 Mos
5.7
38.0
25.2
7.4
-49.2
15.5
-38.5
-42.5
1,217.52
-1.3%
-1.3%
1.1%
1.1%
Canada 10-Yr
1.611%
31.0
31.0
-17.7
-89.7
S&P/TSX Comp
14,952.50
-1.9%
-1.9%
2.2%
4.8%
U.K. 2-Yr
0.626%
19.2
19.2
18.0
-0.6
FTSE All Share
3,728.95
-0.4%
-0.4%
5.6%
2.0%
U.K. 10-Yr
1.948%
15.2
15.2
19.2
-81.9
394.18
0.5%
0.5%
15.1%
16.9%
Germany 2-Yr
-0.207%
2.0
2.0
-10.9
-37.2
Germany 10-Yr
0.393%
6.5
6.5
-14.8
-125.4
STOXX Europe 600
German DAX
11,550.97
1.3%
1.3%
17.8%
21.0%
Hang Seng
24,164.00
-2.7%
-2.7%
2.4%
6.4%
Shanghai Comp
3,241.19
-2.1%
-2.1%
0.2%
57.4%
Nikkei 225
18,971.00
0.9%
0.9%
8.7%
25.3%
India Sensex
29,448.95
0.8%
0.8%
7.1%
36.9%
3,417.51
0.4%
0.4%
1.6%
9.2%
Brazil Ibovespa
49,981.19
-3.1%
-3.1%
-0.1%
6.1%
Mexican Bolsa IPC
43,280.81
-2.1%
-2.1%
0.3%
10.5%
Singapore Straits Times
Commodities (USD)
Gold (spot $/oz)
Price
1 Week
U.S. Dollar Index
Rate
1 Week
MTD
YTD
12 Mos
97.67
2.5%
2.5%
8.2%
22.6%
CAD/USD
0.79
-0.9%
-0.9%
-7.9%
-12.9%
USD/CAD
1.26
0.8%
0.8%
8.5%
14.8%
EUR/USD
1.08
-3.1%
-3.1%
-10.4%
-21.8%
GBP/USD
1.50
-2.6%
-2.6%
-3.4%
-10.1%
AUD/USD
0.77
-1.2%
-1.2%
-5.6%
-15.1%
MTD
YTD
12 Mos
USD/CHF
0.99
3.2%
3.2%
-0.9%
11.9%
-1.5%
-13.6%
USD/JPY
120.72
0.9%
0.9%
0.8%
17.1%
1,166.55
-3.8%
-3.8%
Silver (spot $/oz)
Currencies
15.87
-4.4%
-4.4%
1.1%
-26.1%
EUR/JPY
130.93
-2.2%
-2.2%
-9.6%
-8.4%
5,857.00
-1.1%
-1.1%
-8.0%
-17.1%
EUR/GBP
0.72
-0.6%
-0.6%
-7.2%
-12.9%
Oil (WTI spot/bbl)
49.61
-0.3%
-0.3%
-6.9%
-51.2%
EUR/CHF
1.07
0.0%
0.0%
-11.2%
-12.4%
Oil (Brent spot/bbl)
59.81
-4.4%
-4.4%
4.3%
-44.7%
USD/SGD
1.38
1.0%
1.0%
3.9%
9.0%
2.85
4.1%
4.1%
-1.5%
-39.0%
USD/CNY
6.26
-0.1%
-0.1%
0.9%
2.4%
296.50
-3.3%
-3.3%
-8.1%
-25.9%
USD/BRL
3.06
7.8%
7.8%
15.3%
31.8%
Copper ($/metric ton)
Natural Gas ($/mmBtu)
Agriculture Index
Source - Bloomberg. Note: Equity returns do not include dividends, except for the German DAX. Bond yields in local currencies. Copper and Agriculture Index data as of Thursday’s close.
Dollar Index measures USD vs. six major currencies. Currency rates reflect market convention (CAD/USD is the exception). Currency returns quoted in terms of the first currency in each
pairing. Data as of 9:34 pm GMT 3/6/15.
Examples of how to interpret currency data: CAD/USD 0.79 means 1 Canadian dollar will buy 0.79 U.S. dollar. CAD/USD -12.9% return means the Canadian dollar fell 12.9% vs. the
U.S. dollar year to date. USD/JPY 120.72 means 1 U.S. dollar will buy 120.72 yen. USD/JPY 17.1% return means the U.S. dollar rose 17.1% vs. the yen year to date.
U P CO M I N G EV E N TS
SUN, MAR 8
WED, MAR 11
FRI, MAR 13
Japan Q4 GDP final (0.5% q/q)
China Retail Sales (11.6% y/y)
Japan Industrial Prod.
Japan Private Consump. (0.3% q/q)
China Industrial Prod. (7.7% y/y)
Canada Employment
MON, MAR 9
China Fixed Assets (15.0% y/y)
Canada Unemployment
China CPI (1.0% y/y)
U.K. Industrial Prod. (0.2% m/m)
TUE, MAR 17
China New Yuan Loans (755B)
THU, MAR 12
BoJ meeting
Canada Housing Starts
Eurozone Industrial Prod. (0.2% m/m)
U.S. Retail Sales (0.4% m/m)
Canada Housing Prices
All data reflect Bloomberg consensus forecasts where available
GLOBAL INSIGHT WEEKLY
March 6, 2015
5
AUTHORS
Tom Garretson – Minneapolis, United States
tom.garretson@rbc.com; RBC Capital Markets, LLC.
Kelly Bogdanov – San Francisco, United States
kelly.bogdanov@rbc.com; RBC Capital Markets, LLC.
Patrick McAllister – Toronto, Canada
Distribution of Ratings
For the purpose of ratings distributions, regulatory rules require member firms
to assign ratings to one of three rating categories - Buy, Hold/Neutral, or Sell regardless of a firm’s own rating categories. Although RBC Capital Markets, LLC
ratings of Top Pick (TP)/Outperform (O), Sector Perform (SP) and Underperform (U)
most closely correspond to Buy, Hold/Neutral and Sell, respectively, the meanings
are not the same because our ratings are determined on a relative basis (as
described below).
patrick.mcallister@rbc.com; RBC Dominion Securities Inc.
Eric Lafortune – Toronto, Canada
eric.lafortune@rbc.com; RBC Dominion Securities Inc.
Frédérique Carrier – London, United Kingdom
frederique.carrier@rbc.com; Royal Bank of Canada Investment Management (UK) Ltd.
Davide Boglietti – London, United Kingdom
davide.boglietti@rbc.com; Royal Bank of Canada Investment Management (UK) Ltd.
Jay Roberts – Hong Kong, China
jay.roberts@rbc.com; RBC Dominion Securities Inc.
D I S C LO S U R E S A N D D I S C L A I M E R
Analyst Certification
All of the views expressed in this report accurately reflect the personal views of the
responsible analyst(s) about any and all of the subject securities or issuers. No
part of the compensation of the responsible analyst(s) named herein is, or will be,
directly or indirectly, related to the specific recommendations or views expressed by
the responsible analyst(s) in this report.
Important Disclosures
In the U.S., RBC Wealth Management operates as a division of RBC Capital Markets,
LLC. In Canada, RBC Wealth Management includes, without limitation, RBC
Dominion Securities Inc., which is a foreign affiliate of RBC Capital Markets, LLC.
This report has been prepared by RBC Capital Markets, LLC. which is an indirect
wholly-owned subsidiary of the Royal Bank of Canada and, as such, is a related
issuer of Royal Bank of Canada.
Non-U.S. Analyst Disclosure: Eric Lafortune, Patrick McAllister, and Jay Roberts,
employees of RBC Wealth Management USA’s foreign affiliate RBC Dominion
Securities Inc.; and Davide Boglietti and Frédérique Carrier, employees of RBC
Wealth Management USA’s foreign affiliate Royal Bank of Canada Investment
Management (UK) Limited; contributed to the preparation of this publication.
These individuals are not registered with or qualified as research analysts with
the U.S. Financial Industry Regulatory Authority (“FINRA”) and, since they are not
associated persons of RBC Wealth Management, they may not be subject to NASD
Rule 2711 and Incorporated NYSE Rule 472 governing communications with subject
companies, the making of public appearances, and the trading of securities in
accounts held by research analysts.
In the event that this is a compendium report (covers six or more companies), RBC
Wealth Management may choose to provide important disclosure information
by reference. To access current disclosures, clients should refer to http://www.
rbccm.com/GLDisclosure/PublicWeb/DisclosureLookup.aspx?EntityID=2 to view
disclosures regarding RBC Wealth Management and its affiliated firms. Such
information is also available upon request to RBC Wealth Management Publishing,
60 South Sixth St, Minneapolis, MN 55402.
References to a Recommended List in the recommendation history chart may
include one or more recommended lists or model portfolios maintained by RBC
Wealth Management or one of its affiliates. RBC Wealth Management recommended
lists include the Guided Portfolio: Prime Income (RL 6), the Guided Portfolio: Large
Cap (RL 7), the Guided Portfolio: Dividend Growth (RL 8), the Guided Portfolio:
Midcap 111 (RL9), the Guided Portfolio: ADR (RL 10), and the Guided Portfolio:
Global Equity (U.S.) (RL 11). RBC Capital Markets recommended lists include the
Strategy Focus List and the Fundamental Equity Weightings (FEW) portfolios. The
abbreviation ‘RL On’ means the date a security was placed on a Recommended
List. The abbreviation ‘RL Off’ means the date a security was removed from a
Recommended List.
GLOBAL INSIGHT WEEKLY
Rating
Distribution of Ratings - RBC Capital Markets, LLC Equity Research
As of December 31, 2014
Investment Banking Services
Provided During Past 12 Months
Count
Percent
Count
Percent
Buy [Top Pick & Outperform]
Hold [Sector Perform]
Sell [Underperform]
897
686
112
52.92
40.47
6.61
290
137
6
32.33
19.97
5.36
Explanation of RBC Capital Markets, LLC Equity Rating System
An analyst’s “sector” is the universe of companies for which the analyst provides
research coverage. Accordingly, the rating assigned to a particular stock represents
solely the analyst’s view of how that stock will perform over the next 12 months
relative to the analyst’s sector average. Although RBC Capital Markets, LLC ratings of
Top Pick (TP)/Outperform (O), Sector Perform (SP), and Underperform (U) most closely
correspond to Buy, Hold/Neutral and Sell, respectively, the meanings are not the same
because our ratings are determined on a relative basis (as described below).
Ratings:
Top Pick (TP): Represents analyst’s best idea in the sector; expected to provide
significant absolute total return over 12 months with a favorable risk-reward ratio.
Outperform (O): Expected to materially outperform sector average over
12 months.
Sector Perform (SP): Returns expected to be in line with sector average over
12 months.
Underperform (U): Returns expected to be materially below sector average over
12 months.
Risk Rating:
As of March 31, 2013, RBC Capital Markets, LLC suspends its Average and Above
Average risk ratings. The Speculative risk rating reflects a security’s lower level of
financial or operating predictability, illiquid share trading volumes, high balance
sheet leverage, or limited operating history that result in a higher expectation of
financial and/or stock price volatility.
Valuation and Price Target Impediments
When RBC Wealth Management assigns a value to a company in a research report,
FINRA Rules and NYSE Rules (as incorporated into the FINRA Rulebook) require that
the basis for the valuation and the impediments to obtaining that valuation be
described. Where applicable, this information is included in the text of our research
in the sections entitled “Valuation” and “Price Target Impediment”, respectively.
The analyst(s) responsible for preparing this research report received compensation
that is based upon various factors, including total revenues of RBC Capital Markets,
LLC, and its affiliates, a portion of which are or have been generated by investment
banking activities of the member companies of RBC Capital Markets, LLC and its
affiliates.
Other Disclosures
Prepared with the assistance of our national research sources. RBC Wealth
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Research Resources
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