Meeschaert Amilton advises European midcaps | Photo credit: Shutterstocks
Harry Wolhandler and Nicolas Lasry, managers of the Amilton Premium Europe fund, are positive on European mid caps for five reasons. First of all, traditionally, the growth of SMEs is stronger than that of large caps due to a presence in markets that are often less mature. Then, the leading companies in niche markets are legion. ” They therefore have strong pricing power, which enables them to maintain their margins in an inflationary environment.. »
Third asset, “small and medium caps, more domestic, will be the first beneficiaries of the massive stimulus plans to come. Moderate valuations also make them attractive. ” Our fund’s average price-to-earnings ratio for 2022 is 18 times versus 25 times for our benchmark, the Euro Stoxx Small NR. This is a very reasonable level of valuation given the 30% growth in operating results expected on average for the stocks in the fund.. »
Finally, speculative interest is certain in an environment of ” very low interest rates, abundant cash held by investment funds and abnormally lower valuations of listed companies compared to unlisted ones. Mergers and acquisitions should therefore be numerous.
Investing opinion
We fully agree with this analysis, since we have made French mid-caps, which are generally less expensive than European ones, our favorite asset class for this year.