Global Market Outlook

Innovation is Changing the Growth and Value Universes

David R. Giroux, Chief Investment Officer for Equity and Multi-Asset

Executive Summary

Growth has outperformed value in recent years, but will that outperformance continue? Portfolio Manager David Giroux thinks so. Many value sectors, such as financials, semiconductors, and automobiles, are highly sensitive to economic downturns. Other value sectors, such as telecommunications, will be challenged by the emergence of new disruptive forces in the economy.

Key Highlights

  • Growth has outperformed value for a sustained period, and much of that outperformance has been driven by earnings growth (as opposed to multiple expansion).
  • Much of the value universe faces the challenge of either stagnant growth or growth that could be difficult to sustain moving forward.
  • On a long-term basis Mr. Giroux favors a portfolio that is more positioned for growth versus value.
Views From Silicon Valley and Beyond

In a recent webcast, T. Rowe Price investment professionals share insights from their 4th quarter trip to Silicon Valley. The discussion focuses on how certain secular themes are driving durable growth for select companies.

Important Information

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This material is provided for informational purposes only and is not intended to be investment advice or a recommendation to take any particular investment action.

The views contained herein are those of the authors as of January 2019 and are subject to change without notice; these views may differ from those of other T. Rowe Price associates.

Information contained herein is based upon sources we consider to be reliable; we do not, however, guarantee its accuracy.

Past performance is not a reliable indicator of future performance. All investments are subject to market risk, including the possible loss of principal. All charts and tables are shown for illustrative purposes only.

T. Rowe Price Investment Services, Inc., Distributor.

© 2019 T. Rowe Price. All rights reserved. T. Rowe Price, INVEST WITH CONFIDENCE, and the Bighorn Sheep design are, collectively and/or apart, trademarks of T. Rowe Price Group, Inc.

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