Aussie vs US growth stocks - are we overpaying? NASDAQ volatility is not remotely unusual in this high priced benchmark
Aussie vs US growth stocks - are we overpaying? NASDAQ volatility is not remotely unusual in this high priced benchmark. However, we think that if weakness continues, it may act as a shot across the bows for momentum and quant investors who were only seeing the bright lights of EPS upgrades and ignoring the critical questions (in our minds) about robustness of business model, and what multiple to pay. To this end, we've reviewed what investors are paying for leading growth names in the USA & Australia. Australian growth stocks are trading on average at a 15% PE premium to USA growth stocks (29.6x vs 25.8x), whilst delivering 2.3% lower EPS growth to FY17 (16.7% vs 19.0%) leading to a PEG ratio some 26% higher (1.82x vs 1.45x). This prompts the question: has the lack of quality names in Australia resulted in investors overpaying for growth? More: (VIEW LINK)