Our valuation work for the SP 500 has long assumed moderation of profit growth to about 8 percent from 20 percent and a rise in core inflation.
More Quotes from Abby Cohen:
The basic conclusion is that 1999-2000 will bring further gains in corporate profits, mild-mannered inflation and a generally favorable outcome for equity prices. Increasing confidence that the economic expansion will continue through our newly-extended forecast horizon encourages a modest upward revision in stock price targets.Abby Cohen
Opportunities are likely to present themselves, especially given a 6- to 12-month time horizon.
Abby Cohen
After September 11, 2001, we assumed that the equity risk premium demanded by investors would be above the historical average, but did not anticipate the current extreme reading which is near the highs of the past three decades.
Abby Cohen
For the first time in a decade, our model portfolio is no longer recommending an overweighed position in technology.
Abby Cohen
Models work when they are appropriate for the particular circumstance, but some of the best investment judgments over time have come when people recognized that models derived in other periods were broken or not directly relevant.
Abby Cohen
Corporations in the United States continue to generate good profits. Stock prices are below where they might be based upon the fundamentals for 2005.
Abby Cohen
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