Sam Stovall

This new target incorporates CFRA equity analysts' bottom-up 12-month target prices for stocks in the S&P 500, reflecting their 2017 views on valuation after the just-completed Q4 [fourth quarter] 2016 EPS reporting period, combined with a macro, top-down forecast.” said Sam Stovall on this article: Strategist Stovall raises year-end market forecast as Street tries to keep up with rally. This page contains 41 articles quoting Sam Stovall. Main topics on which Sam Stovall is quoted are S&P and Fed. In addition you’ll find 68 quotes there. All these quotes are mentioned on this page and you can filter them by date and by topics.

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Since prices lead fundamentals, the fundamentals better start picking up the pace in order to justify such extended valuations. Stocks continue to be the asset class of choice. But this crowded trade will likely need confirmation soon from a pickup in EPS growth and forward guidance before investors can feel comfortable pushing prices even higher.

This new target incorporates CFRA equity analysts' bottom-up 12-month target prices for stocks in the S&P 500, reflecting their 2017 views on valuation after the just-completed Q4 [fourth quarter] 2016 EPS reporting period, combined with a macro, top-down forecast.

Valuations are at best fairly valued and at worst overvalued. Yet all of the bulls justify their forecasts by saying that tax cuts are not currently included in the 10.8 percent projected rise in S&P 500 earnings for 2017. They surmise that the forecasted gain will double when tax cuts are added in.

I'm more concerned with the mindset today of the fear of missing out, FOMO. All of the bull markets ... they all go out with a bang. They don't go out with a whimper.

The S&P jumped 3.7 percent in February after rising 1.8 percent in January. In the 27 years since 1945 that the S&P rose in both January and February, the S&P recorded a positive full year return 27 out of 27 times, averaging a total return of 24 percent. In the subsequent March, the S&P gained 1.2 percent and was up 70 percent of the time. It was a nine year plus. We are now the second longest bull market since World War II. If it ended today, it would be the second most expensive. The bull market of 2000 topped out with a P/E of 30 times. This one is at 25 times trailing.

I think the market is basically saying, Oh my gosh, Trump is going to wave his wand and earnings expectations are going to double. I think everyone is assuming that everything he's promising is going to come true. … My feeling is we're going to go through the progression of hype to snipe to gripe.

I think people are going to be looking at economic data to see whether inflationary tendencies are accelerating. Are we going to see an increasing likelihood of a March Fed tightening? It's still on the table, most certainly, and I don't think anything in the minutes are going to make a difference. …Unless the members sounded a lot more hawkish than people assumed. I did not really think that's the case. There's nothing I can really anticipate right now that would make the market stumble.

The reason we haven't stumbled with a P/E so high at this point is, we've had inflation in the low 2 percent area. So as a result, we can stand higher valuations when inflation itself is lower. The reason why history works is because one element has been consistent throughout the beginning of time and that is human reaction.

Normally it takes 24 months to go from each thousand point level. We did it in two months.

Bull markets go out with a bang, not a whimper. It makes me feel confident that we're not coming to the end of a bull market.

I would really get scared if that were the case. We're already in the beginning of a 'FOMO' environment – fear of missing out.

Since 1990, the cyclical sectors, materials and discretionary and tech have traditionally outperformed the S&P 77 percent of the time in the November through April period.

The longer we go, it's more borrowed time. I would say that we would experience a pullback, or a correction but definitely not a correction.

It's like a gigantic magnet that pulls investors towards it, and sort of becomes a self-fulfilling prophecy. The question is what happens once we eclipse it? Usually that honeymoon period lasts for 100 days, and interesting that the honeymoon ends in April, the traditional sell-in-May period. The financials is much more of a Trump situation because of the expected lifting of regulatory pressures, combined with the Fed's effort which would steepen the yield curve and improve their net interest income prospects.

They're sort of like the Dow Transports, from a Dow theory perspective. They have to confirm upward moves.

Historically, the market has performed best in the November-April time frame. The Trump victory added a tailwind to this traditional seasonal factor.

Consumers are earning a bit more and as a result can spend more. But ... people are not too worried the Fed will have to slam on the brakes.

For the year ahead, rather than choosing between 'let your winners ride' or 'buy low and sell high' when establishing a portfolio based on prior-year sub-industry performances, history says that investors have done better buying both last year's 10 best and 10 worst groups.

I'm a little skeptical about the enthusiasm investors have toward what a Trump administration can do.

History says be careful, that traditionally recessions have accompanied Republican administrations. Not necessarily because they do things wrong, but they probably just had bad timing.

In the third year, you've got the party in power wanting to stay in power, and they try to inject stimulus that would cause the economy to grow, and make the electorate happy. That's why nothing happened in the past two, third years. There was no stimulus. That's why we were down both times. The first two times in history that we were down in that third year.

Even though only one other bull market since World War II has lasted this long, the things that would end up throwing us off track, meaning indicators for a recession, are just not there.

I think we've gotten an early Christmas. I think really what we've already seen can be regarded as the Santa rally. We could still see more [gains] – not surprisingly, because who wants to sell out and guarantee they see a higher tax rate than if they sold next year?

There's enough hope and anxious uncertainty that will not be resolved until well into 2017, combined with the desire to avoid paying higher taxes. Those factors will keep the market elevated.

I sort of question whether small caps, Treasury yields, the dollar have all gotten ahead of themselves, and maybe we don't see an instant reversal. Usually we get the mid-December low and then we have a market rally into the end of the year.

Since WWII, the S&P 500 fell an average of 2.7% during the first year of a new Republican president's first term in office.

The obvious question many investors are now asking is, Will November's strength steal from a possible end-of-year rally, especially when it comes to small-cap stocks?' History says no.

Three out of every four Decembers are positive, and they have a gain of 1.7 percent.

We expect investors to gravitate toward more cyclical sectors as a result of a projected increase in defense and infrastructure spending under the new Republican administration.

With the market being up as much as it was in one day … if the only people who voted were Wall Street, Hillary would be a shoo-in. Democratic presidents outperform, but Republican Congresses do even better.

When both the House and the Senate have been Republican, the market was up 13.3 percent versus 7.4 percent under Democratically controlled Congresses, and since Congress controls the purse strings, you might conclude that it's more important to have control of Congress than of the presidency.

The markets have been favoring a victory for Hillary Clinton because there's less uncertainty if she wins. With Hillary you could say it's just more of the same, and nothing's really going to change.

I would say on face value it's saying prepare to be surprised on Tuesday.

This time around if the Democrats retain the White House, I will come up with two responses. One is that history is a guide but never gospel, and two, the negative performance by the market could be a reflection of the worry of domination that a Democratic sweep would bring.

Going back to World War II, the S&P 500 performance between July 31 and Oct. 31 has accurately predicted a challenger victory 86 percent of the time when the stock market performance has been negative.

So while uneven Q3 EPS reports, vacillating election polls and heated rate-hike rhetoric whipsaw investors' emotions, history reminds us that better equity returns may be just around the corner.

It's like walking down the street in the winter time. There are going to be a couple of ice patches that cause us to slip, but in general we're still going to work our way higher through the end of the year. I think we're going to have to leap frog our concerns. The first being earnings, then the election and the third, the prospect of higher rates.

Either way, it's up by about 2 percent and rises between 70 and 75 percent of the time. The market would sell off if something unexpected happened.

The market is waiting for some kind of catalyst. Earnings are providing that on the aggregate level.

Either way, the market is saying I may not like who won but now the uncertainty is over.

Since World War II, if the incumbent person or party gets re-elected, the market has risen an average of 1.7 percent and is up 70 percent of the time in the final two months of the year.

Specifically, the S&P 500 rose 1.2 percent, 1.6 percent, and 2.3 percent in the three- six-, and 12-months, respectively, after recording the final negative quarter during EPS recessions, as compared with S&P 500 average returns of 2.0 percent, 4.1 percent and 8.5 percent during all such three- six-, and 12-month periods.

It typically happens when you head into earnings reporting period that you have a dip because of some negative preannouncements.

He didn't lose ground after debate number two. Debate number three, the question is does he sound more presidential or does he sound more eccentric. It's really more presidential versus sensational.

If history repeats itself, last quarter we were up 3.3 percentage points. If we get that similar improvement, we could see earnings up 2.5 percent.

I don't see the jobs report being strong enough to cause the Fed to want to raise rates in November.

Initial expectations for a fifth-consecutive decline in S&P 500 operating EPS in Q3, combined with elevated valuations, election uncertainty, and the increasing likelihood of a December rate hike could serve as headwinds, tempering end-of-year optimism.

Typically, you have correlations approach 1 when you're in a bear market, and the first year of a bull market.

At first glance, it appeared as if stock markets experienced an equal opportunity sell-off on Friday, September 9, in response to hawkish statements by Fed officials that seemed to prepare investors for a rate hike as soon as the September 20-21 FOMC meeting.

From a technical perspective, we believe the S&P 500 remains firmly in a bullish bias, and has a good chance of bouncing once we trade as low as 2100.

It concerns me that the P/E is high. People have been saying the sky is falling for so long that nobody is paying attention any longer.

We all love to say the market hates uncertainty. If the market is going up the implication is that the market believes that there will not be uncertainty through the change of platform. Hillary has said 'I plan to maintain the Obama platform,' so she is much more of a known quantity.

That's a bullish sign. Historically, it has been. I think the market was looking for some sort of catalyst, because second-quarter earnings season has pretty much run its course.

Investors who are aware that the market traditionally stumbles during these two months are less likely to become their portfolios' worst enemies by reacting emotionally. Rather, we believe investors would be better off buying than bailing, and advise building a 'wish list' of stocks to own.

So which beaten-up stocks look attractive today (and maybe even more so, should the market suffer a setback)? Nine stocks were identified using the screening capability of S&P Global's MarketScope Advisor platform. All carry S&P Global 5-STARS rankings (Strong Buy) and are currently trading at least 30 percent below their 52-week highs.

If the Republicans maintain their dominance then there's less gridlock, but if they don't have a 60-40 majority or an overwhelming majority a lot of things are not going to get put in place, plus the Republicans don't want to increase the debt. They want to reduce the debt.

I can't help but think of how Donald Trump reminds me of a fifth-grader running for president of his class, promising to put Coca-Cola in the water fountains. It may get attention, but it's never going to materialize.

I think with his talking so tough on trade, you could almost say that's going to be an additional incentive for people to focus on domestic stocks, such as utilities, telecom and maybe consumer discretionary, and maybe also mid caps and small caps which have less of an international nature.

I think there could be a reaction. The S&P 500 was up nearly two-thirds of the time during Republican conventions and then up 53 percent of the time in the week after.

Europe is certainly factoring into it, because while most investors believe that Europe can handle a Greek default, as well as, additional debt problems from Ireland and Portugal, it would likely have much more of a problem trying to swallow the debt problems of both Spain and Italy, but it appears as if those two countries are going to need some help as well.

I think it's going to take some time. You could almost say that February is pretty much gone. A lot of the money that will be put into the economy really won't be felt until after the recession has ended in our opinion.

This is telling us that global investors are very very nervous. They really don't want to have long positions over the weekend. They don't want to have exposure to stock over an extended period of time in which additional news could cause prices to fall further.

They (investors) are getting worried that earnings are continuing to tumble as we head toward a global recession, and now what they are trying to do is build-in the possibility of a deeper than expected decline in GDP not only here in the US, as well as overseas.

I think that for the average person on main street the worry is that things have gotten out of hand and that possibly we need some leadership to help us figure out that soon we can come to a resolution with this.

When you have the recouping of all of the losses from a prior bear market, which is what the S&P 500 did back on May 30th of this year, I think going forward it adds confirmation that this bull market is alive and well.

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