Going into a recession, or slowdown, credit risk is very important, and I'm using the working assumption that credit losses will be worse than people think, at the moment. Wells Fargo was much better than most at lending in the late 80's to real estate developers and avoided trouble better than people expected. These might be called the growth stock investors. We owned rural cellular telephone companies and cable companies that didn't have the earnings or book value that traditional value investors require, but we bought them because they had great cash flow. Mail Well , Host Marriott .
Value investors use different criteria to screen out expensive companies.
We like to think about how an owner of the whole business would do if he paid today's price and held the co. forever. If he is likely to do well, it will probably be a good stock. I think generally, that stocks have gotten pretty expensive over the past 25 years of bull market and that we may be in an extended period of very blah stock market returns. Whether the revaluation takes years or is over in a horrible bear market, I have no idea. They are typically invested in T-bills so they can be available quickly.