Why We Are Not Worried About Elevated Profit Margins

The U.S. economy faces a severe downturn, which will undoubtedly depress near-term corporate profitability. However, we on the Focused Equity team believe that longer-term concerns about corporate profit margins are overblown. We wanted to share why we remain sanguine that U.S. public companies, particularly the high-quality businesses that we invest in through our Quality Strategy, can recover and sustain their prior levels of profitability when the Covid-19 crisis passes.