The analysis used to calibrate next year's index view involves nine different methods, including a normalized
earnings yield gap approach, the P / E Bulls - Eye, currency measures, and consumer confidence, which supports a 1,900 year - end result for the S&P 500 - 4 % above the previously released June 2014 expectation of 1,825.
Not exact matches
The
gap between the
earnings yield on the S&P and Baa corporate bonds is over two standard deviations in favour of stocks.
However, holding through
earnings reports is often necessary to «catch the
gaps» and
yield big winners — think 50 % to 100 % or more.
The
gap — the widest since 1986, according to data compiled by Bloomberg — is encouraging investors because
earnings forecasts indicate the U.S. will keep growing, while bond
yields show confidence that inflation will stay in check.»
Price -
earnings ratios are at records for the group, and the
gap between dividend
yields and Treasuries have narrowed.