Friday Morning Coffee Nr. 57: Case for European value stocks reloaded

160519 Friday Morning Coffee

Friday Morning Coffee Nr. 57: Case for European value stocks reloaded

The adage “sell in May and go away” has definitely held true this year with European equities down 3.5% since the beginning of the month. Q1 2019 company results cannot be blamed for this evolution this time around. According to SG Research, 45% of the Stoxx 600 companies that have published showed positive EPS surprises and 18% were in line. European companies are still on track to reach the 5% earnings growth for 2019. To us, this does not really sound as the earnings recession many had feared: on the contrary the health of the European corporate sector is surprisingly good despite the high political noise level.