Are Overlooked Small- and Mid-cap Stocks About to Surge? | J.P. Morgan (2024)


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Are Overlooked Small- and Mid-cap Stocks About to Surge? | J.P. Morgan (2024)

FAQs

Are small-cap stocks a good investment now? ›

“According to Wall Street analysts' earnings estimates, stocks on the S&P SmallCap 600 are expected to see a 22.1% rise in earnings in 2025 versus 14.8% for the S&P 500,” he says.

Why are small and mid-cap stocks falling? ›

Market experts are anticipating a potential slowdown in the mid and small-cap segments due to their high valuations, which may have reached unsustainable levels.

What is the small-cap return in 2024? ›

Key Takeaways. In July 2024, U.S. small-cap stocks outperformed large-cap stocks after lagging for the first half of the year, driven by a cooler inflation report and improved market sentiment.

What is the outlook for small-cap value stocks? ›

Looking forward, we expect value stocks should continue to outperform. Not only are they undervalued, but they also should perform better in an economic environment where we forecast the rate of economic growth will slow sequentially for the remainder of this year and remain sluggish in the first half of 2025.

Should I sell my small-cap stocks? ›

Small-cap is not a bad thing, it is just that you should have the time-frame. If you're investing for any 10 year, small-cap will beat all other kinds of funds hands down, but if you are coming with a very short-term expectation, you will be very surprised in a very negative way.

Do small caps outperform the S&P 500? ›

The S&P 500 and NASDAQ 100 outperformed small caps (Solactive 2000) by more than 16% and 18%, respectively. Since the midpoint, however, the tables have turned. Small caps have rallied over 9% compared to just over 2% for the S&P 500, and less than 1% for the NASDAQ 100.

Are small caps going to rebound? ›

Past performance is not an indicator or a guarantee of future performance. Second, earnings acceleration is expected to be higher for small-cap companies than for large-cap businesses through the end of 2024.

Do small-cap stocks do well in a recession? ›

Investing in small caps during recessions has generated superior investment returns, according to our back-testing of the data to the late 1980s (see Table 1, below).

Why are small caps underperforming? ›

Several factors have contributed to small-cap underperformance, including (1) a decline in the average quality of companies included in small-cap indexes, (2) the greater rate sensitivity of small-cap stocks during a period of tighter monetary policy, and (3) muted M&A activity, which otherwise tends to benefit small- ...

What stocks are undervalued in 2024? ›

6 Top Undervalued Stocks
CompanyTickerIndustry
ExxonMobilXOMOil and gas
ComcastCMCSATelecom
Corebridge FinancialCRBGAsset management
CNH Industrial N.V.CNHFarm and construction materials
2 more rows
6 days ago

Are small and mid-cap stocks undervalued? ›

However, they find opportunities not only in the US but globally. Considering the cash that they generate, small- and mid-cap stocks look undervalued, asserts Kent Chan, equity investment director at Capital Group: "that holds in emerging markets as well as in advanced markets."

Why avoid small-cap stocks? ›

Investors may avoid Small Cap Funds due to their higher risk, volatility, and susceptibility to economic downturns.

Is it wise to invest in small-cap fund? ›

Small Cap Funds offer great potential to earn benchmark-beating returns. These are highly risky investments and should be considered when you can stomach the price volatility.

Which small-cap stock is best to buy now? ›

Small Cap Stocks
Company NameLTPMarket Cap
IVP IVP Ltd₹218.75₹222.39 Cr.
JAYSREETEA Jay Shree Tea & Industries Ltd₹131.61₹380.09 Cr.
KCP K C P Ltd₹241.70₹3,116.02 Cr.
KSL Kalyani Steels Ltd₹778.65₹3,399.59 Cr.
90 more rows

Do small-cap stocks do well in inflation? ›

Emerging market stocks took off, and outperformed their developed market counterparts for close to a decade that followed. The most recent inflation data today resulted in small cap stocks, as measured by the Russell 2000 index, severely outperforming large cap tech stocks as measured by the S&P 500 and NASDAQ.

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