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Investing Insights:

Not all stocks the same for creating returns

Chairman | CEO | CIO Moran Wealth Management®

hen it comes to investing, no strategy – or investor – is In contrast, growth stocks have lost some luster in the current
W high-inflation economy. For example, tech stocks, once the crown
the same. Each portfolio owner has goals specific to
their situation, and their investment strategy should
jewel of the post-COVID rally, received a pummeling in 2022. This
be aligned with those goals. is because they rely significantly on future cash flow projections;
The challenge is that investors’ goals will often shift due to those projections become discounted and less valuable as inflation
various factors. Life events create new financial needs. Market remains elevated and interest rates rise. In comparison, value stocks
environments can swing drastically from one end of the spectrum are priced according to current cash flows, rendering their valuations
to the other. When they do, investors should be open to a modified less sensitive to external pressure.
approach to selecting stocks for their portfolio. Investing in 2023
Value vs. Growth Will value stocks remain an attractive option for investors
For example, we frequently see the need for investors to in 2023? We believe they will, particularly at this point in the
move away from value stocks to growth stocks and vice versa. economic cycle. Although inflation has started to ease somewhat,
Unfortunately, these two investment strategies are often pitted value stocks will likely continue to outperform growth stocks until
against one another since they generally alternate in performance. inflation drops closer to the Federal Reserve’s target of 2%.
While value stocks often provide better returns in down markets, The biggest challenge for many individual investors is
growth stocks usually offer better results in periods of economic recognizing when it’s time to pursue a new investing strategy.
and market expansion. Fortunately, we can help. Our team of experienced investment
During the bull market of the 2010s, value stocks fell out planners can help you review your portfolio to ensure you’re
of favor as investors chased higher returns from growth stocks. selecting stocks to help meet your goals.
However, investor interest in value stocks has risen in the past two
years. What has spurred this resurrection? Fundamental metrics
This article contains general information that is not suitable for everyone and was prepared
such as low price-to-earnings ratios, low price-to-book values, and for informational purposes only. Nothing contained herein should be construed as a solicitation
high dividend yields make value stocks more attractive to investors, to buy or sell any security or as an offer to provide investment advice. Moran Wealth
Management, LLC is a registered investment adviser. For additional information about
who purchase value stocks expecting valuations – and share prices
Moran Wealth Management, LLC, including its services and fees, send for the firm’s disclosure
– to increase as the broader market improves. brochure using the contact information contained herein or visit advisorinfo.sec.gov. Moran
Wealth Management® is a separate entity and not affiliated with any other entity or practice
that uses the same name.
www.Thomas.Moran@MoranWM.com
Tom Moran Phone: 239.920.4440 www.MoranWM.com
AIF® Chairman, CEO, CIO Moran Wealth Management® Fax: 239.431.5239 5801 Pelican Bay Blvd, Suite 110,
Naples, FL 34108

Investment products and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN). Moran Wealth Management is a separate entity from WFAFN. 1221-04126
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