Glamour stocks excitement fades
Even if the recent reversals turn out to be a short-term blip, investors must navigate the likelihood that many glamour stocks will disappoint eventually
Glamour stocks may be losing their allure. Buying profitable businesses at a reasonable price is one of the oldest and most trusted — and some might say boring — playbooks in investing. The father of security analysis, Benjamin Graham, plied the strategy, as did his protege Warren Buffett, legendary mutual fund manager Peter Lynch and countless other stock investors. But there’s been little interest in it in recent years, at least when it comes to US companies.
Instead, investors have been betting on glamour stocks — companies with big expectations and pricey shares, but little or no profit — in the hope that they will blossom into cash cows such as Facebook or Google parent Alphabet. Think, for example, electric car maker Tesla or online video service Netflix, or even pot stocks...
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