In a recent interview, Samantha McLemore, CFA, portfolio manager of Miller Value Partners‘ Opportunity Equity fund, offered insights regarding how value investors can navigate market turbulence.

Here are some highlights of McLemore’s comments:

• “We think it’s premature to call the end of the bull market and to call for a recession, but at the same time, risks have risen primarily on the trade side and on the possibility for a monetary policy error.”
• Strength we’re seeing on the consumer side is against a backdrop of slowing global growth and some weakness on the manufacturing and business side. McLemore cites comments from Bank of America CEO Brian Moynihan that this is attributable primarily to trade uncertainty.
• McLemore notes that most yield curves have inverted, which “can be a signal that a recession is coming. However,” she adds, “it can have quite long lead times” and the market can continue rising for a year or more.
• Overall, McLemore notes, stocks “still look better than all the alternatives.” She notes that the dividend yield on the S&P 500 is higher than that of both the 10-year and the 30-year Treasuries.
• Regarding her firm’s strategy, McLemore says, “We remain focused on companies and on where we can find investments that we think are going to do well over the long term in a variety of scenarios. We are always bottom-up investors.”
• “What we’re not trying to do,” she says, “is time the next news item or trade around a position. We’re trying to focus on the long term and build a diversified portfolio with significant upside.”
• In a market driven by growth names, McLemore says she focuses on free cash flow when assessing businesses: “When building the portfolio, we’ve always focused on having a  mix of cyclically mispriced names, so classic value stocks, and secularly mispriced names… that actually can sustain growth for a long period of time.”
• Regarding challenges the firm faces in this environment, McLemore notes that the “overall macro environment is murkier and there are some bigger risks than we’ve seen yet in this bull market. That’s always a challenge—appropriately reflecting that in the portfolio while remaining true to your core as long-term, patient, value investors.”
• Despite the tough climate for value investors, McLemore says the firm is finding opportunities. She says that although “the market obsesses over certain stuff,” such as growth and defensive names, “it leaves a lot of other stuff sort of thrown to the wayside. That’s fertile hunting ground for us.”