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Searching for Growth in a Low-Growth World

January 25, 2013

Itís axiomatic that over the long run, corporate earnings growth should be driven by nominal growth in gross domestic product (GDP). Over the short run, however, the course of earnings and economic growth can diverge.
-Austin Graff, equity analyst, PIMCO

  • We believe corporate profit growth will fall short of sell-side consensus estimates.
  • But companies with inflation-linked revenues and supply side advantages to drive revenue growth, and those with ample cost levers to improve margins, are positioned for sustained earnings growth in the New Normal.

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