Pricing power, a key criterion today and in the future for investors

Inflation is likely to remain high for a long time. In the United States, corporate selling prices and wages are already accelerating sharply; this will most likely happen in the euro zone as well. In this environment, to preserve their profit margins, companies must have pricing power and be able to pass on their costs (wages, raw materials) to their prices. For equity investors, the value strategy therefore becomes a strategy of selecting companies with pricing power. At sector level, those that in the recent period show the best trend in profit margin rates ( and therefore whose pricing power is normally the highest) are: In the United States: energy, industry as a whole, financial services, retail; In the euro zone: energy, construction, industry as a whole, agri-food, retail.