Remember stock analysts are nearly always too bullish!

As the new year approaches, the financial press will be full of stories such as:

  • “Top 10 stock picks for 2017”
  • “Investment experts say 2017 will…”

Which brings to mind the McKinsey article from 2010 “Equity analysts: Still too bullish”. In essence they found that equity analysts nearly always over-estimate earnings growth. However capital markets are more constrained in how they value companies. Actual P/E ratios are typically substantially lower than those implied by analysts forecasts.  Continue reading

Time to reassess the risk of investing in family businesses?


Family businesses are viewed as being less “corporate” than their listed peers. They are associated with poor governance, family disputes (especially over succession) and bad treatment of minority investors. However, Credit Suisse research indicates family businesses outperform: Continue reading