Growth Equity

The rise of remote work, online dating, and other demographic changes are increasing the demand for aesthetics. GLP-1s provide an effective and inexpensive cure for obesity, and their secondary effect “Ozempic face” has structurally altered the demand for aesthetic procedures and skincare. Long GLP-1 producers, biostimulator injectable producers, and K-Beauty contract manufacturers.

Growth, inflation, and rate risk drive sector returns and fundamentals, but macro’s explanatory power is at multi-decade lows. Long/short industry-group baskets show the equity market has turned pessimistic about growth, a potential opportunity as the macro data firm. The market’s inflation view has climbed, a move that may be harder to fade given rising oil prices. 

We are turning more constructive on Chinese internet stocks after several years of caution. We recommend going long offshore internet equities in absolute terms and upgrading MSCI China to overweight in a global equity portfolio.