Investors Advised to Consider Quality Stocks Amid Market Uncertainty

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Investors,Quality Stocks,Market Uncertainty

Piper Sandler recommends investors to turn to quality stocks due to market uncertainty. The investment firm believes that general uncertainty and lack of a clear economic trajectory will persist, and therefore suggests overweighting quality fundamentals at a reasonable price. The firm looks for stocks with attractive value, cash flow profitability, realized growth, and expected near-term growth. Piper Sandler's Macro Select model has shown strong returns in the past year.

As a cloak of unease shrouds the market, it might be time for investors to consider turning to quality stocks, according to Piper Sandler. "We believe general uncertainty and lack of a clear economic trajectory will persist into the foreseeable future. Thus, we continue to recommend overweighting quality fundamentals at a reasonable price in our Macro Select portfolio," the investment firm wrote in a Tuesday report.

Piper Sandler said it looks for stocks with the following characteristics: Attractive value: determined by high free cash flow yield Cash flow profitability: determined by high cash flow return on investment Realized growth: determined by high earnings per share growth Expected near-term growth: determined by a high earnings per share revisions ratio The strategy's returns speak for themselves, with Piper Sandler's Macro Select model sitting in the top decile of excess return in the past yea

 

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