1. Newsroom
  2. Small- and mid-caps: still attractive investments
Menu
UBP in der Presse 27.06.2017

Small- and mid-caps: still attractive investments

Small- and mid-caps: still attractive investments

L'Agefi - Small- and mid-cap stocks are being buoyed by solid fundamentals and the improving economic environment, and remain attractive as components of a long-term investment strategy.


Since the start of the year, equity markets have been supported by positive economic developments. Earnings are growing again: on aggregate, earnings per share (EPS) are expected to rise 13% this year as opposed to 2% in 2016. This positive environment is particularly beneficial for small- and mid-cap (“SMID-cap”) companies, although returns have varied between stocks in the US, Europe and Switzerland.

Fundamental strengths amplified by a supportive environment

In particular, SMID-caps currently have stronger balance sheets than large-cap stocks, with average net debt/EBITDA ratios of 1.1x and 3.9x respectively. These low debt levels, combined with the global economic upturn, mean that SMID-caps still have substantial growth potential, justifying valuations that may appear high in some cases. That growth potential is also underpinned on a long-term view by their impressive capacity for innovation and their ability to adjust to economic developments, which should deliver additional returns in the absence of any systemic risk.

SMID-caps also have other fundamental advantages. For example, many of them are family-owned companies, managed according to a philosophy that ensures the sustainability of their business. In addition, small companies are often driven by a highly entrepreneurial spirit, the effects of which can be seen most clearly when economic growth is accelerating.

Performance drivers that vary between countries

In Europe in particular, SMID-caps are still offering good investment opportunities because they are attractively valued. European SMID-caps slightly underperformed large-caps in 2016, even though their earnings growth remained positive. Their valuation ratios are currently lower than those of the rest of the market, and lower than their historic averages.


FALLER Nicolas.jpg

Nicolas Faller
Co-CEO Asset Management – Head of Institutional Clients

 

Click to subscribe

Web conference on 30 June, 10 a.m. on small and mid caps

With Charles Anniss, Cédric Le Berre and Benjamin Soussan.

Subscribe now!

Newsletter

Sign up to receive UBP’s latest news & investment insights directly in your inbox

Click and enter your email address to subscribe

Meistgelesene News

UBP in der Presse 14.09.2017

«Wir müssen definitiv härter arbeiten»

Neue Zürcher Zeitung (NZZ) - Guy de Picciotto, Chef der Genfer Privatbank UBP, glaubt, dass die Finanzbranche ein neues Kapitel aufschlagen könne. Die Schwierigkeiten der Vergangenheit seien gelöst. Für die Banken bestehe nun die Chance, alte Stärken auszuspielen.

UBP in der Presse 12.09.2017

Fünf Fragen an Norman Villamin

NZZ am Sonntag (10.09.2017) - Interview with Norman Villamin, Chief Investment Officer (CIO) Private Banking and Head of Asset Allocation.

UBP in der Presse 09.10.2017

Aktive Verwaltung nach wie vor bei Anlegern sehr beliebt

Market -  Mit mehr als 200 Vermögensverwaltungsexperten gehört die Union Bancaire Privée (UBP) zu den führenden Instituten im Dienste institutioneller Kunden. Die Privatbank, die auf aktive Verwaltung setzt, ist zu einem unumgänglichen Player im Asset Management geworden. Gespräch mit Nicolas Faller, Co-CEO Asset Management bei der UBP.

Auch lesenswert

UBP in der Presse 20.08.2018

10 Jahre danach – die Lehren aus der Krise

Le Temps (20.08.2018) - Im Spätsommer jährt sich der spektakulärste Bankrott aller Zeiten zum zehnten Mal.

UBP in der Presse 25.07.2018

Wandelanleihen wecken Interesse der Anleger

Finanz und Wirtschaft (18.07.2018) - With the entry into an advanced phase of the economic cycle, companies have been looking at convertible bonds with fresh eyes as a valid alternative to traditional debt instruments to finance their growth.

UBP in der Presse 16.07.2018

Eric Morin covers a lot of ground in his role

South China Morning Post (14.07.2018) - It may not feature on his CV or official job description, but one of Eric Morin’s key skills is the ability to perform an astute balancing act. Doing that, though, has become second nature to him thanks to more than 30 years in finance and wealth management and a knack for managing change, planning adjustments, and taking a studied approach to every new initiative.