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Time for Value Stocks?


bbarberayr

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http://www.bloomberg.com/gadfly/articles/2016-02-11/investors-ponder-the-value-versus-growth-debate

 

Cheapness of value stocks vs. growth getting up to 1998 levels. Growth outperformance did continue for a couple more years, but then value stocks outperformed for 7 years by 8.5% a year.

 

I'm happy to see money coming out of AAPL, IBB, etc., even though I think this selling is dragging the market down and I also think there is a lot of forced selling coming out of the Middle East. Once the fear and forced selling subsides, people will be looking for places to put their money and I think they will be staying away from the AAPL, IBB stocks which hurt them recently and see things like ING at an 8 p/e or UNP at 13 p/e and move into those types of stocks instead.

 

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http://www.bloomberg.com/gadfly/articles/2016-02-11/investors-ponder-the-value-versus-growth-debate

 

Cheapness of value stocks vs. growth getting up to 1998 levels. Growth outperformance did continue for a couple more years, but then value stocks outperformed for 7 years by 8.5% a year.

 

I'm happy to see money coming out of AAPL, IBB, etc., even though I think this selling is dragging the market down and I also think there is a lot of forced selling coming out of the Middle East. Once the fear and forced selling subsides, people will be looking for places to put their money and I think they will be staying away from the AAPL, IBB stocks which hurt them recently and see things like ING at an 8 p/e or UNP at 13 p/e and move into those types of stocks instead.

 

I think using Apple to highlight overvaluation in the growth segment is a bit of a stretch given the cash they have on hand, their earnings power, moat and current valuation .

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