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A Timeframe for Economic and Market Recovery |
5/30/2020 |
What's the outlook for the economy and stocks in 2020 and beyond?
What a different place the world looks as May 2020 arrived! The faintest glimmers of hope have appeared that the COVID-19 pandemic of 2020 might have reached its worst. While there are still months of recovery ahead, if Americans heed the advice of public health officials, then the process of re-opening the country may begin.
The stock market has continued the roller coaster ride we’ve all been riding since March, as headlines and rumors send stocks plummeting one day and soaring the next. Investors have seemingly accepted the new high-volatility markets as the new norm, though many remain quick to react to economic and company news both good and bad.
There is still much uncertainty surrounding the pace and timing of economic and market recovery, but as money manager and author Ken Fisher pointed out this week, if you can see beyond the next six to 18 months, then reasonable stock valuations abound. That’s one of the few market predictions of the last two months that I can get behind, and it certainly fits with the approach to predicting future earnings growth that I outlined in the most recent issue of the SmallCap Informer.
With that timeframe in mind, this issue has two company recommendations that seem to have the right combination of growth, value, and safety that small-cap investors should be looking for.
As always, feel free to reach out to your editor with questions and comments, and I’ll see you next month.
Stay the course!
— DOUGLAS GERLACH