In our firm’s experience over the past 38 years, Quality Growth stocks have been rewarded for their steady cash flows, predictable returns and serviceable debt loads across a variety of sectors and themes. While our investment results have never exactly correlated perfectly with markets in the short term, we are encouraged to know that our longer-term results have not left clients behind. The S&P 500 Index gained just over 10% during the first quarter while Carderock stocks were not far behind at 8%. For sure, a much stronger start of the year than anticipated.

Continuing the theme from 2023, momentum in Artificial Intelligence (AI) companies have been the dominant beneficiaries within the S&P 500 Index. In looking back over the past 15 months, investors have been hyper fixated on AI’s potential to reshape the US economy – projecting changes in consumption, goods, services and labor. We do agree with the consensus that AI is in its beginning stage and the prospects look promising, but as for investing, it is too unproven and narrow in scope.