Excess Returns Finding Great GARP Stocks with David Giroux
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Jun 9, 2025 David Giroux, CIO at T. Rowe Price, has outperformed his peers for 17 years. He discusses his unique approach to finding GARP (growth at a reasonable price) stocks and why many investors overlook high-quality options. Giroux emphasizes the importance of long-term thinking and his methods for navigating market cycles. He explores the impact of AI on portfolios and challenges conventional views on financials, utilities, and macro forecasts. Listeners also gain insights into the qualities of exceptional CEOs and the benefits of maintaining investment strategies during market dips.
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Hidden Value in GARP Stocks
- GARP stocks grow earnings moderately with reasonable valuations and limited cyclicality, offering strong returns and below-average volatility.
- These stocks are overlooked because they do not fit neatly into growth or value categories, creating market inefficiencies.
Short-Term Focus Creates Opportunities
- The market is extremely short-term focused, with many investors trying to outperform weekly or monthly.
- This intense short-termism creates opportunities for long-term investors to buy when others sell during market downturns.
Tariff Impact Analysis Advice
- Conduct deep legal and policy analysis to assess tariff risks rather than reacting to headlines.
- Use such insights to identify investment opportunities where tariffs are over-discounted.