Are high-quality U.S. large-cap stocks overpriced?

T. Rowe Price explores whether high-quality U.S. large-cap stocks are overpriced. While their “outside view” suggests these stocks are historically expensive, the “inside view” argues that current market conditions and the superior economics of these companies justify higher valuations. The firm concludes that while high-quality large-caps are somewhat expensive, any underperformance is more likely to be a modest lagging in a broader market rotation rather than a significant decline, as they would serve as a funding source for lagging market segments like U.S. small-cap and international stocks.