On the size premium
From the size side, there is a large amount of doubt as to whether there has ever been a size premium that is independent of valuation and liquidity factors. So, if the size premium has historically been close to zero, it's entirely possible that it could be higher in the future. It really depends upon economic developments that are unknown to us at present. If economic changes favor smaller companies, then such stocks will indeed outperform.
I don't think there is really a way to make such a determination. As Larry has pointed out many times in the past, the relative valuation of value stocks to growth stocks really doesn't forecast future performance very well. Most of the time, the market pretty much has it right--if value stocks are priced lower relative to growth than they have been on average, it's because they should be. Past performance is not a good predictor of future performance. That is, if value has underperformed recently, that is not an automatic forecast of future outperformance.
... the expected return for a company...
Finally, always remember that investments don't have expectations; only investors do. Everyone is free to "expect" what they want, and obviously some expectations are more reasonable than others. But there is no objective reality that states that investment A has an expected return of 5% while investment B has an expected return of 7%.
It has been large and statistically significant over the longest periods of time we can measure in the US and foreign markets. Remember, the "size premium" is calculated as SG+SB+SV minus LG+LV+LV, so it teases out the effect of valuation. Has size been larger in "value" and "blend" than "growth"? Yes, but measuring for size while controlling for price also reveals a robust relationship. From 1927-1990, FF SmB averaged +3.1% per year. From 1991-2012 (post FF research on 3F model), FF SmB averaged +3.0% per year. Is some of the size premium associate with illiquidity risks? Probably, but that is a symptom and not a replacement for the more general "size" dimension.
People are fond of saying the size effect has been small since 1984, which happens to coincide with a period beginning after a huge run in small companies and an ensuing bear market for them that was unique to small stocks. This time period doesn't disprove the size effect anymore than the S&P 500 failing to outperform LT Treasury Bonds from 1982-2012 proves that bonds have higher expected returns than stocks.
On expected returns for value stocks
There is pretty robust evidence that the value premium does tend to be very large (above average) and persistent in periods after value has underperformed growth and the spread in valuations has widened. From a Jim Davis paper on the subject, he found that HmL returned +16%, +11.2%, and +6.5% annualized over the ensuing 1, 2, and 3 years after HmL had an extremely poor return (growth beat value by 10% or more in the preceding year).
What you may be thinking is that there is not very good evidence that the value premium tends to underperform (have below average returns) after a period of above average returns relative to growth. From the same paper, Davis found that HmL returned +4.6%, +4.6%, and +4.9% in the 1, 2, and 3 years after HmL had an extremely good return (value beat growth by more than 10% in the preceding year).
On investment expected returns
Investments absolutely do have expected returns. With expected
being the key word. This is just basic corporate finance. An investment is nothing more than a security that represents an ownership stake or a loan to a business. That company has a cost of capital they must pay when attaining new financing (either by selling ownership shares or borrowing money) which is the price which the stock is traded and the interest rate that loans can be made. The expected return of the investment to the owner is simply the opposite of the company's cost of capital. Now, the expected return is not always the realized return -- but the more diversified an investment portfolio, the more likely that the two will converge and the random noise associated with any one security apart from its underlying risk will prevail. And finally, the expected return varies over time inversely with its risk. In times like 2008, perceived risk is high so prices fall to offer higher expected future returns to reward investors for their assumption of greater uncertainty. In times like 1999, the opposite happens.