Argus has published its latest Portfolio Selector, which features its popular Focus List. Each month, Director of Research Jim Kelleher, CFA, surveys the team of Argus Research industry analysts for their timeliest recommendations out of the company's fundamental universe of approximately 500 stocks. The Focus List typically includes 30 stocks: turnover is high, as Jim typically adds three or four new stocks per month. Below are the latest additions, all of which are rated BUY at Argus.

Two important inflation reports -- the Consumer Price Index (CPI) and the Producer Price Index (PPI) -- were released recently and both signaled that pricing pressures are again easing. For now. Both indicated that overall pricing pressures remain well below peak rates in summer 2022 but that inflation remains above the Fed's target of 2.0%. Let's take a deeper dive into the CPI. The news here was surprisingly good, as the annualized headline number ticked lower from the previous month (2.4% versus 2.8%). According to the latest CPI report, the core inflation rate (ex-food and energy) also declined, to 2.8% from 3.1% the prior month. Again, the most-encouraging data was related to Transportation Services and Shelter costs. In these sticky categories, inflation rates year over year have declined meaningfully. Gas prices are also sharply lower year over year, which should please consumers. Meanwhile, PPI measures pricing trends farther up the supply chain, at the manufacturing level. Here, the news also was generally positive. For example, the PPI final demand annual rate through March was 2.7%, compared to 3.2% a month ago and 3.7% in January. Based on the fundamentals, we expect pricing pressures to continue easing as the housing market cools due to high mortgage rates, supplies of new vehicles are replenished, and the price of oil stays below $90 per barrel (current price is $62). But that low price of oil reflects a new wild card that has entered the forecasting picture: Trump's trade wars. His tariffs -- should they ever go into effect -- almost certainly will raise prices, sending the inflation rate higher again. That will put new pressure on the Fed, which we think -- again, based on the fundamentals -- should be in position to lower rates in the second half of the year.

The Portfolio Selector features the Argus Focus List, a group of 30 "best idea" stocks generated and regularly updated by Argus' analysts and investment policy committee. It also includes the director of research’s monthly investment strategy column, stock recommendations and sector picks, economic forecasts, and an asset allocation model. This month, the Focus List additions are United Parcel Service, Inc. (UPS); Elevance Health Inc (ELV); Cisco Systems, Inc. (CSCO); EBay Inc. (EBAY) and the Focus List deletions are Arista Networks Inc (ANET); Illumina Inc (ILMN); Norwegian Cruise Line Hldgs Lt (NCLH); United Airlines Holdings Inc (UAL).

Cisco Systems is the largest provider of networking equipment in the world and one of the largest software companies in the world. Its largest businesses are selling networking hardware and software (where it has leading market shares) and cybersecurity software such as firewalls. It also has collaboration products, like its Webex suite, and observability tools. It primarily outsources its manufacturing to third parties and has a large sales and marketing staff—25,000 strong across 90 countries. Overall, Cisco employs 80,000 people and sells its products globally.