VTV Stock Recent News

After large-cap value indexes outperformed growth peers in 2022, growth strategies have returned the favor in the first few months of 2023 as the macroeconomic and earnings pictures have shifted. Despite this, VettaFi's advisor engagement data for April showed rising interest in large-cap value strategies from the prior month.

VTV: These 5 Stocks Explain Its Disappointing Start To The Year.

The Federal Reserve expects a mild recession to begin later this year. Stocks in the consumer staples, healthcare, and utilities sectors tend to outperform stocks in other sectors during a recession.

Style Box ETF report for VTV

It could be value's time to shine for the first time in years.

The Vanguard Value ETF should be expected to underperform U.S. Treasuries by as much as 4% annually over the next decade based on the current price-to-sales ratio. Rising UST yields could result in a 50% decline in VTV over the next few years relative to USTs, as has happened following several previous negative equity risk premium periods.

Vanguard Value outperformed all the major indexes in 2022, declining only 2.07 percent. Value won 2022 because losses were concentrated in growth stocks. Value investors didn't see large gains unless they placed hefty bets on the highly volatile energy sector.

Vanguard Value ETF provides broad exposure to the largest value stocks in the U.S. and has a well-balanced sector breakdown. It pays a higher dividend yield and offers more downside protection compared to the S&P 500.

The Vanguard Value ETF has outperformed over the past year in line with a global reversal in value stocks relative to growth, but the easy gains are now behind us. While the PE ratio on VTV is just 15.1x, profit margins are at record highs and should be expected to mean revert lower over the long term.

Thomas Cole, co-founder of Distillate Capital Partners, discusses whether value stocks can continue to outperform in 2023.