Morgan Stanley strategists have noted that small-caps offer stronger revenue growth prospects, with the S&P 600 expected to generate sales per share of 6.6%, compared to the less than 0.1% for the S&P 500. UBS also expects earnings growth for smaller companies to be in the low double-digit range, whereas large-caps will likely generate earnings growth in the mid single-digit range.
“Small-cap fundamentals remain solid,” Jeremy Zirin, chief equity strategist at UBS Wealth Management, said in the FT article. “Greater domestic and cyclical exposure, higher interest rates and a stronger dollar should all help drive small- and mid-cap outperformance in the months ahead.”
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For more information on small-capitalization stocks, visit our small-cap category.
Max Chen contributed to this article.
Full disclosure: Tom Lydon’s clients own shares of SPY.