Cheaper Stocks Overseas

Many investors seeking current value are looking beyond U.S. borders. That's because global stocks appear cheaper than domestic stocks on numerous valuation metrics. Consider yield. The yield on the S&P 500 is 1.8%, below the global average of 2.6% and well below the 3.7% average yield in Europe. A review of price/sales ratios tells a similar story. The U.S. multiple is 2.2, well above the global average of 1.4 and even lower multiples in Japan and Europe. P/E ratios are similar, with a current trailing multiple for the S&P 500 of 21.0, above the global average of 17.0. One reason investors pay a higher price for North American securities is the transparency of the U.S. financial system. Moreover,...  returns may be volatile in overseas markets given currency, security and political risks; indeed, U.S. stocks are outperforming the EAFE in 2018. Even so, we recommend that Growth investors have 15%-20% of their equity holdings in international stocks and continue to add global stocks to the Argus universe of coverage.    more

Argus President John Eade discusses the markets response to midterm elections

Indecision remains high following selloff

Major indices are mixed at mid-day Tuesday following yesterday's selloff. While the market opened higher, it came under pressure directly following the open, but has since started to recover, placing the indices above yesterday's close. This indecision is likely sparked by trade rumors coming from the White House. ...  more

Trying to Right the Ship: Our Monthly Survey of the Economy, Interest Rates, and Markets

September typically ends summer on a down-beat; it is among the weakest months of the year as measured on the S&P 500 since 1980. And then stocks usually rally in October, kicking off the best quarter of the four for stocks. ...more