LLC has struggled since interest rates started to advance, but they’ve arguably magnified the sector’s weakness, e.g. the stock is down another ~20% in 2023 alone. We have a core bullish outlook on bonds and bearish yields, which should finally offer a tailwind for LLC into 2024, it feels overdue to average or cut as the stock plumbs multi-year lows, at least we have no earnings gauntlet to run until February. The 7.2% short position into Christmas might add support for the stock if/when we see some profit taking although it’s unlikely to be as dramatic as enjoyed by ELDs following its result yesterday.
- We are considering increasing our LLC position into the current weakness in line with our bullish outlook towards the Real Estate Sector – MM holds LLC in its Active Growth Portfolio.