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ASR in FT Unhedged: Can we make US stocks look cheap?

Beth McCann

23rd MAY 2023

The FT’s Ethan Wu notes: “Standard p/e’s are slightly above historical averages, the Shiller cyclically adjusted p/e ratio is very high and the equity risk premium is near a decade low. If there is a valuation metric that makes the market look cheap, we haven’t seen it.”

Querying ASR’s Ian Harnett: “Might cheapness lurk below at the sector level?” Ian responded, "Mostly, no…"

Referring to this ASR slide of the S&P 500, Ian Harnett explains: “the upper-rightmost chart breaks out p/b ratios by sector. With the exception of media and maybe banks, all sectors are trading above or around their 10-year average.” 

To read the full FT column, please see HERE (FT subscription required)

Clients can listen to more from ASR on equity valuations in this Webinar Recording: Quant & Equity Factor Strategy Focus – 12 May 2023 

To receive a copy of this recording as part of a free trial, kindly reply HERE 

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