Summary of Investors Brace for a Decline in Valuation Multiples

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Investors Brace for a Decline in Valuation Multiples summary
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After a long bull market, an increasing number of portfolio managers and analysts are worried about valuations, according to this survey by Jeffrey Kotzen, Tim Nolan and Frank Plaschke of the Boston Consulting Group. Investors reveal their expectations for stock market valuations and shareholder returns in 2014, which hold some lessons for executives on striking the right balance between hitting short-term goals and increasing long-term company value. getAbstract recommends this brief report to investment professionals, corporate managers and investors for its insights on prospects for stocks and corporate growth.

In this summary, you will learn

  • What expectations portfolio managers and analysts have for stock market returns, earnings and valuations in 2014;
  • What implications these prospects have for corporations; and
  • How managers can combine short-term strategies with long-term value creation.
 

About the Authors

Jeffrey Kotzen is a senior partner and managing director at Boston Consulting Group, where Tim Nolan and Frank Plaschke are partners and managing directors.

 

Summary

After unusually robust returns for equity markets around the world since 2012, portfolio managers and analysts expect lower valuation multiples and more modest total shareholder returns (TSR) in 2014. In a 2014 survey, 36% of respondents – the highest number since 2009 – reported their belief that the...

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