The Meb Faber Show - Better Investing Robeco’s Matthias Hanauer - Think Value Investing Is Outdated? Think Again | #561
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Dec 13, 2024 
In this conversation, Matthias Hanauer, a researcher with Robeco’s Quant Equity Research team, delves into the evolving landscape of value investing. He reveals how interest rates shape the relationship between growth and value stocks. The discussion highlights the promise of emerging markets and small-cap stocks, as well as the impact of recent U.S. elections on market trends. Matthias also explores the intriguing 'Factor Zoo' and the integration of machine learning in modern investment strategies, challenging conventional wisdom on value metrics.
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Enhanced Value Factor
- Robeco's enhanced value factor considers various valuation metrics beyond book-to-market.
- It includes EBITDA to EV, cash flow to price, and net payout yield, offering a more comprehensive view.
Value Stock Performance
- Value stocks underperformed due to expensive stocks becoming even more expensive, particularly big tech.
- The average value stock performed similarly or better than the average growth stock.
Region and Sector Neutrality
- Robeco's enhanced value factor is region and sector-neutral, comparing similar stocks across markets.
- The 2018-2020 period saw expensive stocks outperform cheaper ones within each sector, unlike the dot-com bubble.