Asks if 2026 brings a new investment story or continuation of earnings-supported bull market.
Mike
Andrew Slimmon
Large tech stocks (Mag-7) underperformed in Q4 despite strong earnings, creating opportunity as multiples start 2026 lower than last year.
Questions if rotation toward cyclicals positioning for stronger nominal GDP is misguided.
Mike
Andrew Slimmon
Industrial stocks have priced in Fed cuts and need earnings to support valuation, while tech stocks had earnings but didn't deliver price performance.
Notes valuation ceiling seems firmer outside tech.
Mike
Andrew Slimmon
Financials are exception - still trade at 30% PE discount due to post-2008 muscle memory, but deregulation is releasing capital.
Questions if banks' historical discount reflects uncertainty about loss reserves.
Mike
Andrew Slimmon
Deregulation releasing capital will be deployed, driving earnings without PE compression risk seen in industrials.
Asks if AI capital raising (IPOs, debt) and lower buybacks create supply-demand concern.
Mike
Andrew Slimmon
Wouldn't base investment decisions on syndicate calendar concerns, though big underwritings could temporarily suck cash from market.