29 days ago • Posted by Jasper Lawler
The strength in value stocks in 2021 is not about yields, its about the EPS recovery - NDR
The EPS recovery in 2021 should be the fastest since 2010, and it’s driven by Value, as shown in the chart above.
The Ned Davis Research Growth index’s EPS is 15% above the trend line, while the Value is 38% below and indicating more upside/mean reversion potential.
Growth has already priced in EPS recovery in 2020 while Value has been pricing in EPS recovery in 2021. In this context, Growth has still been leading the recovery and now leading the consolidation phase.
Source: Seth Golden / Ned Davis Research