Buy Value Stocks After Rout Slashes Valuation Excess, JPMorgan’s Kelly Says
- Strategist says underweight mega caps, ‘nervous’ on small caps
- ‘You just have to have the guts to get in,’ he advises
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The latest leg down in US stocks coupled with a solid earnings season so far has dropped S&P 500 company valuations closer to historical averages.
The combination provides an opening for investors to consider value stocks, according to JPMorgan Asset Management’s David Kelly. The chief global market strategist is still wary of big tech stocks though, as the group’s price-to-earnings ratio remains elevated relative to history.