(New York)

If you survey advisors—which many have done—they will tell you that the hardest part of the forthcoming Reg BI rule from the SEC is how to handle all the requirements of the new Customer Relationship Summary form (Form CRS). With that in mind, Pershing has just launched an interesting new end-to-end Form CRS product that helps advisors comply with the rule, as well as a Tracking and Reporting Solution. According to Pershing, “We recognize that account opening is not the only [thing used], so we’ve rolled out a new forms management system where the CRS can be directed and stored digitally, and married that system with a number of trigger points that require the delivery of a Form CRS … We’ve given our clients the opportunity to both deliver forms in paper where it’s still necessary, or digitally to the extent that the investor has opted into electronic delivery”.

FINSUM: Compliance with Form CRS is a challenge, and one that is being exacerbated by COVID and people working from home. This sounds like a great solution.

(New York)

May was a rough month for dividend stocks. Many companies announced the suspension of dividends or at least a cut. However, 11 companies in the S&P 500 announced dividend increases. That is an interesting group to look at because it likely means their businesses are thriving. Ten of those are: Medtronic, PepsiCo, Clorox, Cardinal Health, Chubb, Expeditors International of Washington, Baxter International, Northrop Grumman, TE Connectivity, Ameriprise Financial.

FINSUM: Pepsi and Clorox are the most interesting of the bunch for us. Both are consumer staples and because of their unique positioning, both seem likely to thrive.

(New York)

Morgan Stanley put out a very direct research report this week. In it, it tells investors which stocks they definitely should not buy. The bank selected 22 “Secularly Challenged Stocks” which it says no one should own right now. Here is a selection: Alcoa, AMC Networks, Abercrombie & Fitch, CenturyLink, Macerich, Cheesecake Factory, H&R Block, Michael’s, and Molson Coors Beverage.

FINSUM: A lot of names one would expect here, but some that are a bit of a surprise. We certainly would not want to own Macerich given the state of commercial retail real estate, but CenturyLink would not seem nearly so dangerous.

(Seattle)

One of the things that makes Amazon such an extraordinary company is that it is always on the look out for the next great business opportunity, and always seems to be one step ahead in executing it. AWS anyone? Now the champion of Seattle may be eyeing a new target—ride-sharing. Amazon is considering the acquisition of Zoox, a well-known autonomous vehicle company. If it were to acquire Zoox, it would immediately be in competition with Uber and Lyft in the soon-to-be autonomous ride-sharing market.

FINSUM: We assume Amazon also has some yet-to-be-understood purpose for this beyond just competing with Uber and Lyft. For instance, autonomous delivery/logistics vehicles?

(Atlanta)

Some stocks seem to be rallying for no apparent reason. The only underlying logic being that they got badly beaten up during the COVID meltdown and now look cheap relative to the market’s rebound. Call it the loser’s rally. Delta, for instance, has seen some significant gains in its price despite the fact that the airline business continues to look very bleak. Delta could be considered best-of-breed though, having a much healthier balance sheet than American Airlines.

FINSUM: This is a dangerous game—when stocks that look weak rise for no apparent reason. They will fall sharply when sentiment swings back.