There's 'pent-up opportunity' in small caps: Portfolio manager
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- Опубліковано 26 вер 2024
- Small-cap stocks (^RUT) are on the move after the Federal Reserve initiated its highly anticipated interest rate cut. Goldman Sachs asset management portfolio manager Greg Tuorto joins Catalysts to discuss the outlook for small-cap stocks and some of his top picks as interest rates continue to fall. "There's been a number of tailwinds for small caps that really have been ignored over the last couple of years as we've waited for this rate uncertainty. The economy is quite stable. It's still growing. I don't think that we're expecting a big downtick in the economy next year, that's good. It's a very domestic asset class, and the US is the best house in a number of bad neighborhoods. That's also quite good," Tuorto tells Yahoo Finance. He points to areas like technology and healthcare with undervalued small-cap players. Tuorto notes that small caps have underperformed for nearly three years, which is much longer than the typical year-long down cycle. "There's a lot of pent-up opportunity in this space because what you've seen in terms of small-cap performance has not come from from multiple expansion. It's really come from the earnings. And we think that the earnings opportunity next year for small caps is better than it was in 2024. We think it's better than large caps," he argues. As the Fed continues to ease rates, Tuorto won't be paying too much attention to the amount of rate cuts. "So many of our companies had to really understand how to operate under much higher rates. So I think that as you kind of think about where things are going, it's much more of a significantly more powerful tailwind than a normal rate cut cycle," he explains. While software has been the sector avoided most during rate hikes, Tuorto believes now is an "interesting tactical time to get back in there." He expects more IPOs (initial public offerings) in the sector throughout the rest of 2024 as well as M&A (mergers and acquisitions) activity. He highlights DigitalOcean (DOCN) as one of his top software picks, noting there is a significant AI opportunity among small- and medium-sized businesses. On the consumer side, he points to Shake Shack (SHAK), Ollie's (OLLI), and Boot Barn (BOOT) as small-cap opportunities investors should take advantage of. For more expert insight and the latest market action, click here to watch this full episode of Catalysts.
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I moved from Tampa to Santa Clara a few months ago and I’m thinking of purchasing a single family home there, but with real estate prices currently through the roof, is it still a good idea to buy a home or should I invest in stocks for now and just wait for a housing market correction? Looks like NVDA, TSM and AMD and AVGO are strong buys this week.
it’s a personal decision, but according to Forbes, housing activities will remain stagnant for the most part of the year, so maybe hold off a little.
Since risk is at an all-time high right now, perhaps you should be a little more patient and return when it has decreased. Alternatively, you can consult a trained financial expert for strategy.
Yes true, I have been in touch with a brokerage Advisor. With an initial starting reserve of $80k, my advisor chooses the entry and exit commands for my portfolio, which has grown to approximately $550k.
I’m an art collector, this is not very new to me but has a nuance to it. Can you assist me?
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Small Caps have had a negative return in the last 3 years, worst performing asset class. The S&P 600 peaked in Fall 2021 and it still has not recovered 3 years later.
Not a downtrend next year yea ok
I recently sold some of my long-term position and currently sitting on about 250k, do you think Nvidia is a good buy right now or I have I missed out on a crucial buy period, any good stock recommendation on great performing stocks or Crypto will be appreciated
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I don't really blame people who panic. Lack of
information can be a big hurdle. I've been
making more than $100k passively by just
investing through an advisor, and I don't have
to do much work. Inflation or no inflation, my
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people who panic.
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I've been an investor in Apple, gold, housing market as well because I strongly believe in them, I've always believed in the stock, but now I don't know if to re-distribute my portfolio and put some money in Nvidia or Tesla especially now that we are experiencing a market correction
Both stocks have a long term potential, The most important thing is the ratio of the distribution based on the financials of each company. There are many other companies that are also doing well. You could just hire a financial advisor to guide you. A financial advisor really does help me do the distribution even between different asset classes. I don't even understand technical financial terms much. I just know I make really good profit, and I don't have to stress myself a lot.
I've got similar problems and I have also considered using an FA but I don't know how to go about it. Please, what are the steps for getting one? Like a really good one.
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