December 19, 2024: We update an asset class yield analysis first published in 2021. Since that time, we have seen dramatic changes in the valuation of some assets, most notably U.S. equities. VIEW/DOWNLOAD
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November 1, 2024: Large cap stocks are extremely concentrated even beyond simple measures of the weight of the largest few stocks. Historically, levels of concentration to this degree have subsequently seen strong outperformance among smaller stocks within the large cap universe. Equal weighted indexes also subsequently do well, but equal weight indexes themselves can suffer from lower quality. For longer term investors, this analysis supports our view that there is great opportunity to invest in the higher quality parts of the market with a bias away from the largest and most expensive stocks. VIEW/DOWNLOAD
Large cap U.S. stocks in aggregate look expensive. This is primarily a function of current market leadership, where the 15 most expensive companies over $250 billion in market cap are collectively trading at a 72% premium to the rest of the market. The situation appears similar to the one in March, 2000, when the overall market was even more expensive, but a set of opportunities below the surface provided good absolute returns, even as the TMT bubble collapsed. We take a harder look at the market now versus 2000 in our letter. VIEW/DOWNLOAD
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The concentration within the S&P 500 is at historic levels. This has produced a divergent set of returns and valuations across the large cap market we have not seen in decades. While our U.S. FSV portfolio has underperformed in this environment, we are steadfast in the view that valuation matters and are optimistic given that our portfolio is at a record free cash flow yield premium to the market. The Small/Mid QV and International FSV strategies also continue to have attractive free cash flow yields while maintaining an eye on quality. VIEW/DOWNLOAD
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May 10, 2024: March 31st marked the 5-year anniversary of the Distillate Small/Mid Cap Quality & Value strategy. We summarize its performance record since inception here. VIEW/DOWNLOAD
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While NVIDIA has driven the market’s valuations higher, we continue to find valuation opportunities that meet our quality standards, leading our U.S. FSV portfolio to its widest free cash flow yield premium in its history. Our Small/Mid QV and International FSV portfolios likewise offer very attractive combinations of valuation and quality. VIEW/DOWNLOAD
19th
19th
Dec, 2024
December 19, 2024: We update an asset class yield analysis first published in 2021. Since that time, we have seen dramatic changes in the valuation of some assets, most notably U.S. equities. VIEW/DOWNLOAD
1st
1st
Nov, 2024
November 1, 2024: Large cap stocks are extremely concentrated even beyond simple measures of the weight of the largest few stocks. Historically, levels of concentration to this degree have subsequently seen strong outperformance among smaller stocks within the large cap universe. Equal weighted indexes also subsequently do well, but equal weight indexes themselves can suffer from lower quality. For longer term investors, this analysis supports our view that there is great opportunity to invest in the higher quality parts of the market with a bias away from the largest and most expensive stocks. VIEW/DOWNLOAD
9th
9th
Oct, 2024
Large cap U.S. stocks in aggregate look expensive. This is primarily a function of current market leadership, where the 15 most expensive companies over $250 billion in market cap are collectively trading at a 72% premium to the rest of the market. The situation appears similar to the one in March, 2000, when the overall market was even more expensive, but a set of opportunities below the surface provided good absolute returns, even as the TMT bubble collapsed. We take a harder look at the market now versus 2000 in our letter. VIEW/DOWNLOAD
8th
8th
Jul, 2024
The concentration within the S&P 500 is at historic levels. This has produced a divergent set of returns and valuations across the large cap market we have not seen in decades. While our U.S. FSV portfolio has underperformed in this environment, we are steadfast in the view that valuation matters and are optimistic given that our portfolio is at a record free cash flow yield premium to the market. The Small/Mid QV and International FSV strategies also continue to have attractive free cash flow yields while maintaining an eye on quality. VIEW/DOWNLOAD
