European Capital Partners - No time for style discussions Discover this fund | European Capital Partners
Asset management and fund structuring boutique

No time for style discussions

Mar 12, 2024

MSCI World Value currently trades at 13.5 times trailing earnings. This PER is below the 50 year average and less than half the multiple of MSCI World Growth. This is undeniably a cheap valuation. At 29.1 times trailing earnings, it is also a fact that valuation of growth stocks looks stretched compared to its history. However, this does not necessarily mean that value stocks will outperform over the coming 10 years. Historically, the current multiples resulted in subsequent 10-year returns that were similar ( around 8% to 10% ) for both styles. We conclude there is no room currently for extensive style discussions but we continue to invest into quality businesses that we think are undervalued compared to their earning power.

No alt text provided for this image

Return to overview