Only the VALUATION has changed

In recent weeks as the market has moved into correction status, it’s important to remember that the fundamentals haven’t changed- only the valuation.  The S&P500 is still likely to earn around $124 this year.  Last month investors were willing to pay a higher premium, more than 16.5 times forward earnings.  Today the valuation has dropped below 16…but the fundamentals remain the same.

Investor sentiment is a fickle thing.   The market is currently at a FAIR VALUATION but not a BARGAIN.

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Range bound lower valuation 150831


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