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How to improve quality investing

2025Journal article Open access
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datacite.subject.fosCiências Sociais::Sociologia
datacite.subject.sdg09:Indústria, Inovação e Infraestruturas
datacite.subject.sdg11:Cidades e Comunidades Sustentáveis
dc.contributor.authorGonzález, Luis Otero
dc.contributor.authorSantomil, Pablo Durán
dc.contributor.authorVieito, João Paulo da Torre
dc.contributor.authorReboredo, Juan Carlos
dc.date.accessioned2025-07-15T14:29:42Z
dc.date.available2025-07-15T14:29:42Z
dc.date.issued2025
dc.description.abstractIn this article, we evaluate the relationship between quality investing combined with Economic Moat, ESG (Environmental, Social and Governance) and analyst opinions over the period 2014–2020 based on a data set comprising 803 US stocks. Performance is evaluated using several metrics (returns and alphas). Our results show that quality stocks measured by return on invested capital (ROIC) exhibit superior performance. The incorporation of competitive advantages allows a better discrimination among the classic high-quality strategies. Investment in stocks with quality and high ESG entails the payment of a premium but buying quality companies with Economic Moat makes up for this negative aspect. The results show how quality companies that have competitive advantages obtain a better future performance and are recognized by the market with a higher valuation. However, the markets may take time to recognize this value since the incorporation of the average Price-to-Price target (Analyst consensus) increases the future performance. JEL classification: G11; G14; G23eng
dc.description.sponsorshipThe author(s) disclosed receipt of the following financial support for the research, authorship, and/or publication of this article: We acknowledge the funding of: (1) the Galician Regional Government [ED431C 2020/18] co-funded by the European Regional Development Fund (ERDF/FEDER) for the period 2020–2023 and (2) the Ministry of Economy and Competitivity (PID2021-1243360B-100).
dc.identifier.citationGonzález, Luis Otero; Santomil1, Pablo Durán; Vieito, João Paulo da Torre; Reboredo, Juan Carlos (2025). How to improve quality investing. BRQ Business Research Quarterly. ISSN 2340-9444. 28:2, p.453, 473
dc.identifier.doi10.1177/23409444231202810
dc.identifier.eissn2340-9444
dc.identifier.issn2340-9444
dc.identifier.urihttp://hdl.handle.net/10198/34667
dc.language.isoeng
dc.peerreviewedyes
dc.publisherSAGE Publications
dc.relationALGORITMI Research Center
dc.relationResearch Center in Basic Education
dc.relationResearch Centre in Digitalization and Intelligent Robotics
dc.relationMountain Research Center
dc.relationMountain Research Center
dc.relationAssociate Laboratory for Sustainability and Tecnology in Mountain Regions
dc.relation.ispartofBRQ Business Research Quarterly
dc.rights.urihttp://creativecommons.org/licenses/by/4.0/
dc.subjectQuality investing
dc.subjectEconomic Moat
dc.subjectESG
dc.subjectAnalyst forecast
dc.subjectPerformance
dc.titleHow to improve quality investingeng
dc.typejournal article
dspace.entity.typePublication
oaire.awardTitleALGORITMI Research Center
oaire.awardTitleResearch Center in Basic Education
oaire.awardTitleResearch Centre in Digitalization and Intelligent Robotics
oaire.awardTitleMountain Research Center
oaire.awardTitleMountain Research Center
oaire.awardTitleAssociate Laboratory for Sustainability and Tecnology in Mountain Regions
oaire.awardURIinfo:eu-repo/grantAgreement/FCT/6817 - DCRRNI ID/UIDB%2F00319%2F2020/PT
oaire.awardURIinfo:eu-repo/grantAgreement/FCT/6817 - DCRRNI ID/UIDB%2F05777%2F2020/PT
oaire.awardURIinfo:eu-repo/grantAgreement/FCT/6817 - DCRRNI ID/UIDB%2F05757%2F2020/PT
oaire.awardURIinfo:eu-repo/grantAgreement/FCT/6817 - DCRRNI ID/UIDP%2F00690%2F2020/PT
oaire.awardURIinfo:eu-repo/grantAgreement/FCT/6817 - DCRRNI ID/UIDB%2F00690%2F2020/PT
oaire.awardURIinfo:eu-repo/grantAgreement/FCT/6817 - DCRRNI ID/LA%2FP%2F0007%2F2020/PT
oaire.citation.endPage473
oaire.citation.issue2
oaire.citation.startPage453
oaire.citation.titleBRQ Business Research Quarterly
oaire.citation.volume28
oaire.fundingStream6817 - DCRRNI ID
oaire.fundingStream6817 - DCRRNI ID
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oaire.versionhttp://purl.org/coar/version/c_970fb48d4fbd8a85
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