Our valuation work for the S&P 500 has long assumed moderation of profit growth to about 8 percent from 20 percent and a rise in core inflation. |
Ours is an economy that is solid at its core. |
Such a 'flu shot' is now widely expected and would be unlikely to unsettle investors beyond a transitory period. |
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. |
The global backdrop in 1999 will continue to offer impediments, but we expect Supertanker America to stay its course of moderate economic and profit growth. |
The global backdrop in 1999 will continue to offer impediments, but we expect Supertanker America to stay its course of moderate economic and profit growth. A supertanker is not necessarily fast or colorful, but it is steady and reliable and hard to push off course. |
The primary assumption is that economic and profit growth will resume by midyear. |
The principal conclusion is that we expect profit growth to continue through our new forecast horizon. |
We are currently advising a moderate overweight, with an emphasis on oil services and a small number of integrated producers. |
We believe that the backdrop for investments in technology is favorable. |
We don't think so, and continue to assume long-term earnings growth of 7 percent-to-8 percent in our valuation model. |
We expect 1999 and 2000 to be years of ongoing profit expansion, with better aggregate gains than 1998, which was disappointing. |
We expect 2001 to be yet another year of profit expansion, albeit at a slower pace. |
We expect profit growth to decelerate in the second half of 2004. |