EFTA01458538.pdf

2 October 2015 US Equity Insights 3Q results will once again highlight a divergence between a sharp profit recession at Energy, Industrials, Materials, but decent EPS growth elsewhere. 3Q won't be great for Banks ex. litigation. But Health Care, most of Consumer Discretionary and consumer exposed Tech will be good. Because of this ongoing divergence in EPS growth and also shareholder distribution coverage, we advocate a LIFO strategy, meaning that stocks last into the correction will ikely be first out, as opposed to a FIFO or YTD momentum reversal strategy. Figure 5: S&P 500 quarterly EPS & Sales growth and Net Margins by sector (3Q15 is blended with actual tor reported and consensus for the rest) I 1 4 :ra 7•4'1 :44 Las 0 3$7,497 OH 1 XS/ 10 4% 113% 17.9% 09% 10,46 Oft 3 311 71% 51% SS 50% V I% 83% 074 108% 4.714 30% 11% 44% 4.1.4970•• 14. .. a .70% SIM 940ar Fn F. 33% 44.19C0a. 4.... 40% 144. 0. **Ad scv. 9. , 71% SAP es Eno* 14•1441.14.44,ce 4% 11% Lenin• 411444 , 4•1 0014 4440•10740757/89e 107% 11.4% H6% 4174 .119% 91% !I se On 58% . cr, /IN eta, . 216% i ,.:". 120% Om Owe Sat • FtarlItstin OF% zrn 119% 174 .474 an F.7% 'II% 'I0 :R 37714 OQn 'en Si% 53% .. A . , 4, ' . es . rs. . IN •••,, '7% • v. ..s. 5% 49.4, 4479 70.rtseet l%%01, /Pe On 2/ Ps ,26191 339% F5 34 Pi% 4191 15% '0% %In ..9. 109% 117% 171% 113% *1% 410% 010.1044/44111.411/41 CM 44476 0A 0 16 .91. 0 1% -0013 743% 73% 07% 12444 .. 33 02% V% .33414 937% 7.1% an is* * r n 1..s, .... ar. - v .4 n ... .. 4.. 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IlIet 310% : t UPS 1.4%.... . rim . ” 3- 33 3•1' 373.:' .44 " 120% 11441 .41X44 030 00004B0 Deutsche Bank Securities Inc. Page 3 CONFIDENTIAL — PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0118498 CONFIDENTIAL SDNY_GM_00264682 EFTA01458538