Analysts at Goldman Sachs said in a research note Wednesday that they expect corporate profits supported by healthy economic growth to be the main driver of future stock returns.
The investment bank believes stocks with high operating leverage are poised to benefit, but at the index level, already elevated multiples and high interest rates limit the potential for further valuation expansion. right.
According to Goldman Sachs, “Companies with high operating leverage can increase sales without increasing costs.As a result, stocks with high operating leverage have higher profits than stocks with low operating leverage. “Profits could grow faster.”
Furthermore, we believe that the sales growth outlook also suggests that stocks with high operating leverage will outperform stocks with low operating leverage.
Additionally, the bank, which believes the shift in consensus makes today's trade attractive, says the case for stocks with high operating leverage is strengthened by near-record valuation discounts for stocks with low operating leverage. It is said that there is
The bank said, “Investor confidence in the strength of the U.S. economy has increased, leading to positive sales revisions for 2024 from the start of the year.Historically, stocks with high operating leverage have also It has shown its best performance when it is in the expansion area,” he added.
