๐๐ก๐๐ญ ๐๐ซ๐ ๐ญ๐ก๐ ๐ฆ๐๐ข๐ง ๐ฌ๐จ๐ฎ๐ซ๐๐๐ฌ ๐จ๐ ๐ญ๐ก๐ ๐๐ช๐ฎ๐ข๐ญ๐ฒ ๐ซ๐๐ญ๐ฎ๐ซ๐ง๐ฌ?
Sometimes itโs straightforward: strong earnings usually support rising stock prices.
But many times, itโs not that simple. Returns can come from several componentsโvaluation expansion, currency effects, and dividends, to name a few.
๐๐ก๐๐ญ ๐๐จ๐๐ฌ ๐ญ๐ก๐ ๐๐ก๐๐ซ๐ญ ๐๐๐ฅ๐จ๐ฐ ๐ฌ๐ก๐จ๐ฐ?
Looking at the past 15 years:
- U.S.: Earnings growth and multiple expansion were the main drivers.
- Europe: Dividends contributed the most.
- China: Dividends were also a major factor.
We can say these are the key elements investors tend to focus on in each region.
๐๐จ๐ฐ ๐ ๐ช๐ฎ๐๐ฌ๐ญ๐ข๐จ๐ง ๐๐จ๐ซ ๐ญ๐ก๐ ๐ง๐๐ฑ๐ญ ๐๐ ๐ฒ๐๐๐ซ๐ฌ:
Would you rather invest in great companies that are consistently highly valuedโlike $V (Visa) or $MSFT (Microsoft) โknowing that any contraction in multiples could lead to a sharp drop?
Or would you prefer similar-quality businesses with lower valuations, where stock performance is more closely tied to the companyโs real results: earnings, cash flow, and dividends?
Before answering the big question, take a moment to look at the massive changes weโve seen in 2024 and 2025.
Do we really think we can predict the next 15 years?
Will investors always be willing to pay 30โ40ร earnings every year?
Curious to hear your thoughts.
Keep it simple,
@Aguero1010
source:
am.jpmorgan.com - 28th of November edition... Show More
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