VB - Small-Cap EPS Growth Ahead VB A Solid Choice (Rating Upgrade)

2024-04-24 10:15:07 ET

Summary

• Small-cap earnings growth has been negative for six consecutive quarters, but projections show a turnaround in the second half of 2024.
• The Vanguard Small-Cap Index Fund ETF Shares offers a solid long-term investment option with a wide valuation gap to large caps.
• The VB ETF has a diversified portfolio with exposure to various sectors, including information technology, and has outperformed other small-cap ETFs.
• I outline key price levels to watch as bullish seasonal trends persist.

It hasn’t been easy being a small-cap bull over the last handful of quarters. Earnings growth among the group of domestic stocks has been tepid, to put it mildly. While the S&P 500 (SP500) endured an earnings recession of just three quarters, the SmallCap 600 Index has had six consecutive quarters of negative year-on-year operating EPS growth. ...

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