Page 6 - Value Uncertainty News Today

Most utilities have strong balance sheets and dividend growth potential, but we don't think that justifies trading at 20 times earnings.

In the long term, gaming companies could level up.

We think oil consumption will continue to recover.

There are few undervalued stocks in the sector.

Drug and biotech industries pricing in the risk of policy changes in the U.S., but we don't think there will be a big regulatory impact.

The investing legend might take an interest in these high-quality firms if Berkshire were nimble enough.

Energy stocks have caught up after a tough 2020 - source: Morningstar Although prospects for global herd immunity have receded, given the spread of coronavirus variants and uneven vaccinations, we continue to expect global crude consumption to return to 2019 levels within two years. Developed markets can still achieve herd immunity if they reach critical mass vaccination before variants become widespread. And elsewhere, life can still mostly return to normal as long as vaccines continue to lowe...

U.S. materials index versus U.S. equity index - source: Morningstar Trailing one year, the materials sector has massively outperformed by more than 2,380 basis points compared with 185 basis points of underperformance a quarter ago. As a result of the rally from the depths of the pandemic, just two U.S. basic materials stocks we cover now trade in 4-star territory, and no stocks trade at 5 stars. Less than 10% of materials stocks trade at attractive discounts - source: Morningstar Industrial ga...

Despite pockets of uncertainty, communications stocks power ahead - source: Morningstar While Internet giants Alphabet (GOOG) and Facebook (FB) dominated the sector’s performance in 2020, this year has been all about the smaller guys. Midtier media companies Discovery (DISCA), ViacomCBS (VIAC), and AMC Networks (AMCX) have jumped over the past couple of months, even after a decline following an equity issuance at ViacomCBS, as investors have apparently warmed to their direct-to-consumer conte...

Most investors wouldn’t expect gains from their defensive, income-oriented holdings as interest rates shoot up. But that’s exactly what utilities have offered investors. Even though utilities have trailed the market, the sector is up 7.6% since last August even as 10-year U.S. Treasury rates have tripled. Utilities have been worst-performing sector since the market bottom - source: Morningstar We think there are two reasons utilities might be able to hold onto these positive returns even if...