Trendline Economics conducted its own research, and we concluded that value stocks have indeed regained the lead on a long-term basis, possibly for years to come. We see the outperformance of value stocks continuing to lead growth over the next five years, with intermittent spurts of outperformance by growth stocks. However, we do believe the outperformance of value will be slight.
Our estimate is for value to post at least 30% total returns over the next five years, and for growth to post returns in the neighborhood of 20%. The definition of “value stocks,” however, has changed, such that the old “growth vs. value” debate needs a revamp.
Link to Post