Posted 1/17/2024, 4:45:00 PM
Small Caps Poised for 60% Surge in 2024 Due to Cheap Valuations, Says Fundstrat's Lee
- Small cap stocks could surge 60% in 2024 on attractive valuations compared to the S&P 500, the lowest since 1999 according to Fundstrat's Tom Lee
- Russell 2000 small cap index trails S&P 500 significantly in 2023, but underperformance sets up opportunity in 2024
- Valuation of Russell 2000 relative to S&P 500 is at 1999 levels, which preceded 12 years of small cap outperformance
- Lee says improving market participation beyond mega tech names and retail flows returning to stocks could lift small caps
- Small caps highly levered to rates and economy - falling rates and faster growth would provide tailwinds