Since investment in value stocks, under-priced stocks, do usually have lower value than investment in glamour stocks
, over-priced stocks, do, negative earnings surprises due to accounting irregularities would decrease value stock prices more than glamour stock
Contrary to general explanation they find the announcement reaction to glamour stock
ABSTRACT: We investigate whether the accruals anomaly is a manifestation of the glamour stock
phenomenon documented in the finance literature.
Midlands-based Keller, the specialist cement and foundations group, is not a glamour stock
and is often overlooked.
For example, it suggests that a high-priced glamour stock
has particularly low conditional expected returns, and particularly high conditional volatility, in the wake of recent bad news about fundamentals, because this high-price/bad-news configuration suggests that the potential for a "paradigm shift" among investors is elevated.
While these are today's glamour stocks
, Feingold is candid about the potential pitfalls of these kinds of secular growth stocks:
A series of papers by Fama and French (1992, 1993, 1995, 1996, 1998) starting with an examination of cross-section of returns and cuhninating with an examination of returns on value versus glamour stocks
has led to a resurgence of this literature.
The high-earning glamour stocks
have always been in new technology enterprises, starting with canals, then railways through more recently to information technology and now the Internet.
Recently, John Rekenthaler of Morningstar, the Chicago-based fund-tracking service, wrote in his column on the concern's Website that "in comparison with the overall stock market, the S&P 500 has become light on the pricey glamour stocks
and heavy in the cheap, old-era industries like cyclicals, banks, tobacco.
The Footsie fallers board read like a roll-call of last year's glamour stocks
, with top-ten dogs of the day including IT group CMG down 471p to pounds 38.
Compounding the situation, Wall Street has the industry on hold, with analysts seeing few glamour stocks
among the companies that feed the nation.