This is a stock picker’s market.
“This environment will create an important backdrop for active investing,” said Ken McAtamney, global equity leader at William Blair.
“Understanding companies with distinct business models, unique cultures and enduring competitive advantages will be increasingly important to determine investment performance in this complex environment,” he added. while also noting that “the dynamic change of winners and losers within the company remains constant.”
One of the biggest mistakes investors can make is assuming that all stocks in a given industry will rise and fall in tandem. It’s an overly simplistic, binary view of the world.
Instead, investors need to do their homework and find companies with strong business models and sound fundamentals.
“Not all businesses are created equal,” said Paul Moroz, Chief Investment Officer at Mawer Investment Management.
“First quarter results so far underscore our view that investors need to be selective,” said Mark Haefele, chief investment officer at UBS Global Wealth Management.
Haefele added that “Tesla’s record profits reflect surging global demand for electric vehicles,” and pointed out that “disappointing results for Netflix should not obscure the strong outlook for futures.” subscription service.”
The massive failure of Netflix could turn out to be a company-specific problem. It is not necessarily a reason to shun all other FAANGs.
Of course, investors are still willing to flock to companies that are reporting good results. Tesla’s success shows that traders aren’t afraid of the high-priced stocks that value investors like Warren Buffett tend to shy away from.
Yes, Tesla is expensive when you look at the traditional price-to-earnings ratio and compare Tesla to the rest of the auto industry. But as long as Tesla lives up to the hype, that might not matter.
Louis Navellier, founder of Navellier & Associates, said: “The ability of Tesla to hit a trillion-dollar valuation … is a confirmation that paying for future earnings potential remains an investment. sound investment with the right business model,” Louis Navellier, founder of Navellier & Associates, said in a Thursday report.
