Growing challenges to banks have weighed on recovery hopes for value stocks. But our research of Japan’s experience and global value trends suggests value stocks don’t necessarily need financials to turn the corner.
Value stocks have underperformed in the coronavirus crisis. Yet some higher-quality companies are now trading at valuations that underestimate their ability to withstand shorter-term stress—and their longer-term recovery potential.
Global value stocks have continued to underperform in 2019. But there’s a big disconnect between the weak returns of cheaper stocks and their underlying earnings profile.
Value stocks have underperformed for years. But things may be changing. Cheaper stocks have shown signs of awakening recently, and several market forces could tip the scales in favor of value after a prolonged growth surge.
Private equity funds continue to attract interest, despite rising deal valuations and high levels of leverage. We think there’s a way to get many of the benefits of private equity in public markets—without forfeiting liquidity.
After a record 2017, private equity funds have $1 trillion to deploy. The Financial Times reported this week that the buyout industry is raising more money than it can spend. As new risks surface, we think public equity portfolios with the right strategic mindset can deliver similar benefits to investors.
When equity investors chase what’s hot, it often ends in tears. Today, the safety trades that have been so popular earlier this year are actually looking quite dangerous.