Weekly Bot Brief Newsletter on Robotics 3/26/2021
"There is no force on earth more powerful than an idea whose time has come." VIctor Hugo
Bots in The News:
For the second consecutive week, the S & P 500 outperformed the NASDAQ dominated Bot Index. While the S & P 500’s larger cap focus gained 1.57%, the bots fell 1.59%. The only strength within the Bot Index came from the near 6% gain from Rockwell Automation. The stock has improved by over 9% since the beginning of the year and has noted some recent increase in volume as the company’s earnings have surprised on the upside over the past four quarters.
Weakness was noted in six names that recorded declines in excess of 5%. The worst of which was the 16% fall by NIO Ltd. Its sister trader, Tesla also declined over 5.5% as investors have recently discounted the potential for the EV market. Two names that dominated the weaker end of this week’s performance spectrum are likely to show some upside in next week’s trading. Accuray Inc. declined 6.36% and Immersion Corp. fell 5.17%. On Saturday, however, Zachs published a research report entitled “Coronavirus Ups the Game for Robotic Surgery – 3 Stocks on Radar.” Of those three, Accuray was mentioned as likely to be a beneficiary of increased surgical procedures following the introduction of its Cyberknife S7 platform. Immersion Corp. was subject to comments from another Zach’s report, “Single Best Pick to Double” that stated, “From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.” That company was Immersion! Depending upon how the market itself performs next week, it would be a likely bet that Accuray and Immersion will be top performers.
Will Adam Smith Rethink Absolute Advantage??
In the January 2021 American Economic Review, authors Jesse Perla, Christopher Tonetti and Michael Waugh explored technology transfer and implications on international trade. In something of a rebuke of Adam Smith’s concept of absolute advantage and Ricardo’s comparative advantage, the BC, Stanford, and NYU professors wrote “Equilibrium Technology Diffusion, Trade, and Growth.” You may recall from Econ 101, that Adam Smith hypothesized that, “If a country can produce something better than we ourselves, better to buy it from them with the product of our own industry in which we have a competitive advantage.” In that regard, he recognized that countries may have abilities through natural resources, weather, geography, or demography to produce specific goods or services more efficiently and more cheaply than other countries. This is somewhat true today, however, the economies of the world have changed since Smith’s time. In the AER feature, the authors argue that the adoption of superior production technologies will allow countries to produce certain items on par with their trading partners. In their ‘takeaways’, Perla, Tonetti and Waugh expressed that “increases in international trade have the potential to deliver large welfare gains by addressing inefficiencies.” These gains are a function of lower productivity countries that can readily adopt higher efficiency technologies, thus allowing them to compete on a more level field. This plays perfectly into the ability of all economies to utilize the results of the Robotic Revolution and assist in the welfare elevation of all countries.
Member: American Economic Association, Society of Professional Journalists, United States Press Association. Institute of Chartered Financial Analysts, Robotic Industries Association, Member IEEE.
The Bot Brief is a weekly newsletter designed for economists, investment specialists, journalists, and academicians. It receives no remuneration from any companies that may from time to time be featured in the brief and its commentaries, analysis, opinions, and research represent the subjective views of Balcones Investment Research, LLC. Due to the complex and rapidly changing nature of the subject matter, the company makes no assurances as to the absolute accuracy of material presented.