News
Back in a bear market
By Michael O’Connor
Investors' wounds deepened last week as the S&P 500 fell nearly 3%, declining for the fourth week out of the past five.
The NASDAQ precipitous decline continued into Monday, putting the tech-based index into bear-market territory, as it fell more than 20.0% below a recent high set in November. While this drop may seem alarming, the NASDAQ has compounded at 21% a year for the last five years despite experiencing three bear markets in the past five years.
All is not lost.
To be blunt, the outlook remains very much uncertain. The degree and duration of the war are huge unknowns that can change rapidly and have enormous implications on economic growth, inflation, and interest rates.
With that said, my base case remains the same. The war can subside over the coming months allowing inflation to moderate and sentiment to revert. With strong consumer demand, robust US household balance sheets and money on the sidelines, earnings can remain elevated, and US economic growth can remain positive.
Valuations have also become more compelling at current levels, with the S&P 500’s forward P/E now below its pre-pandemic levels. Undoubtedly multiples can contract further in the short-term if the geopolitical tensions worsen, but I believe a reversal is likely by year-end as the current headwinds subside.
Winners
The dating App Bumble jumped 28.5% last week as the firm's revenue figures grew 25.7% year-over-year.
Despite Bumble experiencing its strongest trading day ever, it still sits 70% below its IPO price. The current inflation-induced growth stock distain will ensure that a quick reversal to previous highs remains unlikely despite last week's success.
Losers
It appears that investors previously boasting the endless potential of every high-growth SaaS company in existence are now cutting all ties and denying any involvement, quickly reclaiming Warren Buffet as their one true leader.
DocuSign tops the bill this week as the poster child of the discarded pandemic darling. Already down 70% from all-time highs, the stock plummeted another 20% following Thursday's less than inspiring earnings call.
In keeping with the theme of the quarter, the company reported solid Q4 results, but weaker guidance sent the stock plummeting. Lower than expected revenue guidance and a predicted annual growth of only 13% for a company that is still pre-earnings brought the growth narrative very much into question.
Outlook
Lower valuation multiples are appealing, but investors are acutely aware of the dangers that lie ahead over the short term. Inflation has surged to a 7.9% annual rate, a number that looks likely to remain elevated as commodity prices rise, while upcoming interest rate hikes represent the potential for a policy misstep by the Fed.
Volatility is likely to remain, but some sectors will absorb the impact better than others. Short duration, long value remains the order of the day with a tilt towards energy, consumer staples and real estate.
To learn how to start your investing journey, go to the islandinvestor.com.
A special commemoration took place at Fitzgerald Stadium to mark the 50th anniversary of the sudden passing of former Dr Crokes player, officer, and selector Tim (Timmy) Keogh.
All-Ireland winning Kerry and Dr Crokes manager Pat O’Shea unveiled a memorial plaque in honour of Mr Keogh, who died suddenly at the stadium on 24 May 1976 while watching the East Kerry Under-12 final between Dr Crokes and Legion.
Pat O’Shea, who played in that fixture as a nine-year-old, delivered a moving address reflecting on the tragedy and his memories of Killarney half a century ago. He described Mr Keogh as a dedicated family and community man who led the way for the Dr Crokes club.
O’Shea recalled how the match was halted and the young players were brought into the dressing rooms, leaving an indelible mark on the town. He also paid tribute to Mr Keogh’s late wife, Kathleen, and noted the bittersweet memory of neighbours and Legion icons Weeshie Fogarty and Johnny Culloty rushing to his aid on the sideline.
Speaking on behalf of the family, Eamonn Keogh detailed his father’s extensive contribution to the black and amber. Timmy Keogh served as club treasurer through the 1950s and 1960s alongside Donie Sheahan and Michael O’Connor, and was a selector for the famous Dr Crokes senior team that won seven consecutive O’Donoghue Cups between 1956 and 1962.
Eamonn thanked Fitzgerald Stadium Chairman Der Brosnan and his committee for permission to erect the monument. He welcomed members of the Keogh, Fogarty, Culloty, and Randles families, alongside several players from the 1976 under-12 panel and MC Denis Coleman.
Eamonn paid tribute to Pat O’Shea’s legendary status in the GAA, noting he remains one of only five managers to win both an All-Ireland senior inter-county championship and a senior club title.
Fr Tom Looney spoke of receiving the tragic news via a letter from his mother while serving in Peru 50 years ago, praising Mr Keogh’s legacy with Dr Crokes and local employer Hilliards. Fr Tom performed a blessing alongside Franciscan Friary Guardian Br Pat Lynch and Fr Billy Hoyne.
The commemoration concluded with a musical performance of ‘Buachaill ón Éirne’ and ‘The Parting Glass’ by Timmy’s son, Don Keogh, on concertina, and his cousin, Máire Breathnach, on guitar.
The large attendance included Mayor of Killarney Martin Grady, Kerry GAA Chairman Patrick O’Sullivan, East Kerry Board officials Dermot O’Connor and Noel Kennedy, Dr Crokes President Jackie Looney, Chairman Eoin Brosnan, and Juvenile Chairman David Byrne.
Two young local girls showed great business initiative on Saturday ahead of the Kerry v Donegal match at Fitzgerald Stadium.
Erin McSweeney and Jessie Doolin set up a sweet stall outside a house on Lewis Road, catching the thousands of football fans walking towards the grounds.
The enterprising pair did a busy trade selling soft drinks, sweets, and chocolates to the passing crowds before throw-in.
Their match-day venture also caught the attention of the national sports media, with a photograph of the girls at their stall captured by Sportsfile photographer Stephen McCarthy ahead of the game.
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