Glamour stock

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Related to Glamour Stocks: Growth stocks

Glamour stock

A popular stock characterized by high earnings growth rate and a price that rise is faster than the market average in a bull market.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Glamour Stock

A popular stock that is held by a large number of investors, especially institutional investors. A glamour stock usually has a high price and almost always has a high P/E ratio because of the larger than normal demand for it.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved
References in periodicals archive ?
One such series of studies [Fama and French (1992, 1993, 1996), Lakonishok, Shleifer, and Vishny (1994), Chan, Jegadeesh, and Lakonishok (1995), La Porta, kakonishok, Shleifer, and Vishny (1997), Kothari and Shanken (1997), Arshanapalli, Coggin, and Doukas (1998), Pontiff and Schall (1998), Doukas, Kim, and Pantzalis (2002) and Zhang (2005)] has focused upon explanations for the premium earned by high book-to-market value stocks relative to glamour stocks. The interpretation of, and explanations for, why value-strategies outperform growth-strategies remain unsettled.
(3) While not disputing the conclusion, Lakonishok, Shleifer, and Vishny (1994) attribute the superior returns of value strategies to a consistent overestimation by investors of future growth rates of glamour stocks relative to value stocks.
Lakonishok, "'Evaluating the Performance of Value versus Glamour Stocks: The Impact of Selection Bias," Journal of Financial Economics, 38, no.
On the other hand, investors are overly optimistic about glamour stocks and have higher expectations of future growth because these firms had strong earnings and growth in the past.
Thus, SG1 contains stocks with lowest past sales growth (value stocks), SG2 has stocks in quintiles 2, 3, and 4 of sales growth, and SG3 comprises firms with the highest past sales growth (glamour stocks).
Moreover, a conditional accruals strategy that excludes glamour stocks (B/M1) from low-accruals portfolio (Acc1) is more profitable than a plain vanilla accruals strategy.
ABSTRACT: We investigate whether the accruals anomaly is a manifestation of the glamour stock phenomenon documented in the finance literature.
In the light of the above empirical evidence, there is a significant difference of average annual return and announcement return between high book-to-market (value stock) and low book-to-market (glamour stock).