103 days ago • Posted by Charles-Henry Monchau

U.S Small Caps Valuations: Extreme Gap between Growth vs. Value

Source: Russell (small caps) growth names are trading near 5x sales, close to the 94th percentile vs. Russell value names which are still 18% below long term average. There divergence between growth and value equity valuations over the past decade is not sustainable. The valuation of the market is arguing for a rotation, not another leg up - Source: Bloomberg, The Bear Traps Report.

U.S Small Caps Growth valuation vs. U.S Small Caps Value valuation