BTIM: Identifying the next wave of outperformers

BT Investment Management have identified 3 key structural developments which they believe will have significant implications for investors. 1) “The era of abundant liquidity has come to an end.” As the Fed begins to tighten, access to cheap debt is becoming difficult to find. 2) “The economic cycle has become more muted.” Returns are likely to be lower, and companies are focussing on return OF capital, not return ON capital. 3) “Disruptive forces are changing the outlook for returns.” Disruption is not just for tech companies; Aldi has taken market share from Woolworths and Coles in recent years. So where should investors look? “We are focusing on factors that can change earnings outcome, whether it be a change to industry structure, cyclical trends or business innovation. We also look out for companies demonstrating disciplined capital allocation or embarking on a ‘self-help’ journey.” Read the article for more detail and one stock they believe meets these criteria. (VIEW LINK)


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