Stick with value stocks until everyone starts talking about them — they’re still under the radar, this Wall Street firm says

Bank of America strategists argue that value stocks remain underappreciated by investors, even as the market environment shifts in their favor. The firm highlights that in a regime of structurally higher interest rates and persistent inflation, companies with stable cash flows and reasonable valuations tend to perform well relative to growth-oriented peers. Despite this, value continues to fly "under the radar," suggesting the trade may still have room to run until it gains broader recognition.

The relevance for markets lies in positioning. If value is indeed overlooked, a future rotation could provide support for sectors like financials, industrials, and energy—areas typically associated with the style. Investors should watch for signs that value is becoming a crowded topic, such as benchmark-relative fund flows or a sharp narrowing of valuation spreads between value and growth. That would signal the opportunity may be maturing.

For now, the takeaway is not a recommendation to buy or sell, but a reminder that market regimes change gradually. Understanding the drivers behind style performance, and monitoring sentiment around them, can help investors interpret the landscape rather than chase headlines.