Valuations in Europe are optically "cheap" but the Old World abounds in value traps
. Without a credible FANG growth names, Europe exports risk capital to Wall Street and China.
"Hence, it is important to weed out value traps
, that is, firms with suspect corporate governance or accounting." The magic formula is just one step.
Be wary of companies that could be value traps
, or just avoid them altogether.
I also look for dynamic and growing businesses with earnings and dividend growth of at least 5% as a way to avoid value traps
. Third is balance sheet strength-companies with financial structures that can support their business and, importantly for me, support the dividend." Most of the approach is bottom-up-researching individual names-but Threadneedle also applies a macro framework.
These stocks can be value traps
," Morgan Stanley said in a note.
Here is a checklist of potential transfer for value traps
in the buy-sell planning area.
The Canadian markets are littered with 'value traps
' that lie in wait for the unwary.
The internal gumption traps are value traps
that block affective understanding, truth traps that block cognitive understanding, and muscle traps that block psycho-motor behavior.
Of course, cheapness alone is never a criterion for investing as value traps
exist in banking.
To invest well, you need to not only find great buying opportunities, but also avoid "value traps
,'' which are stocks that appear to be great values but actually are not.
Further, in Indian companies, usually the promoter family controls a large part of equity, and so it is difficult to impose change or protect minority shareholders." That's why Parikh says that one must be on guard against value traps
Goldman Sachs waved investors away from the sector calling newspaper stocks "value traps
," in a note issued on Thursday.