Is Now A Good Time For Value?
|Gotham Yield (as of 2/03/20231):||13.18%|
|Percentile Towards Cheap:||86th|
|Average Two-Year Forward Return*:||54.64%|
* Based on historical research
Mouse over each blue square as well as the best fit line to see additional information
Click on each blue square as well as the best fit line to see additional information
Click on points/line to see additional info
Past performance is no guarantee of future results.
In the adjacent chart, In the above chart, we demonstrate the potential value opportunity for a relatively unconstrained, highly diversified research portfolio consisting of 700–800 positions selected from a universe of the largest 1,400 US securities, weighted towards those stocks priced at the largest discount to our assessment of value. The portfolio is updated daily based on changes in stock prices and company valuations and designed to reflect the least expensive 20% of the selected investment universe.
As of 2/03/20231 this research portfolio has a 13.18% Gotham Yield, which places the portfolio in the 86th percentile towards cheap relative to historical valuations over a 30+ year research period. Cumulative two–year (504 trading days) forward returns from this valuation level have averaged 54.64% based on our historical research. Gotham Yield is a proprietary assessment of earnings and cash flow relative to the adjusted enterprise value of a business2.
Each blue square within the chart represents the two-year forward return of the research portfolio plotted against its Gotham Yield at a unique starting point over the 30+ year research history. The step interval or space between the start dates for each blue square is 21 trading days. There are typically 252 trading days in a year and 21 trading days in a month. The best fit line, also known as a regression line, is a mathematical concept that best expresses the trend indicated by the data points on the graph.
If you are interested in learning more about our research, please reach out to our Investor Relations team at 212–319–4100 or by email at [email protected]. We welcome the opportunity to speak with you further.
Gotham Yield is based on Gotham’s proprietary methodology used to compare companies in a consistently meaningful way. Gotham’s analyst team utilizes a proprietary research process to assess a company’s pre-tax cash flow, return on capital, and enterprise value. This information is updated throughout the year to account for company performance. The metrics for any one company or portfolio can change daily to reflect either new information and/or changing stock price. Gotham Yield is a position weighted aggregate across the research portfolio. Gotham Yield does not represent income received by the research portfolio.
This webpage contains forward-looking statements regarding future events, forecasts and expectations regarding equity markets and certain of Gotham's research portfolios. Forward-looking statements may be identified terminology such terms as "may", "expect", "will", "hope", "believe" and/or comparable terminology. No assurance, representation, or warranty is made that any of Gotham's expectations, views and/or objectives will be achieved, and actual results may be significantly different than reflected herein.
The performance of the research portfolio is not intended to indicate the past or future performance of any investment product.
The research portfolio results represent hypothetical performance and are provided to put current market prices in context based on Gotham’s valuation methodology and historical research. The research portfolio was not actually traded during the time period indicated. Back-tested performance is hypothetical, is not based on the performance of actual portfolios and is provided only for informational and illustrative purposes. Hypothetical past performance is not indicative of future results.
Back-tested results have certain inherent limitations and differ from actual performance for several reasons, including because they are achieved through the retroactive application of the strategy designed with the benefit of hindsight. There is no assurance that results on a historical basis will work effectively on a prospective basis. The back-tested performance:
- Does not reflect the actual investment of funds, actual trading, actual market impact of buying and selling securities, trade timing, or security liquidity;
- Does not reflect the impact that material economic and market factors might have had on Gotham’s actual decision-making;
- Does not reflect a deduction of any management fees or incentive compensation for the hypothetical gross returns; and
- Includes the reinvestment of income and the deduction of estimated transaction costs and does not reflect taxes.
1Generally, near the beginning of the trading day
2Companies for which there is not applicable data to calculate Gotham Yield, primarily financial companies, have been excluded.