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Steve Hach is the Senior Editor at ValuEngine.com, a Newtown, Pennsylvania-based stock valuation and forecast service. ValuEngine utilizes Ivy League financial research as the basis for its coverage of more than 7000 US, Japanese, and Canadian, and other foreign stocks. Hach utilizes... More
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  • ValuEngine.com: Oil-Driven Unrest Causes Retreat To "Normal" Valuations

    VALUATION WATCH: Overvalued stocks now make up 50.52% of our stocks assigned a valuation and 15.04% of those equities are calculated to be overvalued by 20% or more. Nine sectors are calculated to be overvalued--one by double digits.

    With Latest Market Unrest, Valuations in "Normal" Range Again

    ValuEngine tracks more than 7000 US equities, ADRs, and foreign stock which trade on US exchanges as well as @1000 Canadian equities. When EPS estimates are available for a given equity, our model calculates a level of mispricing or valuation percentage for that equity based on earnings estimates and what the stock should be worth if the market were totally rational and efficient--an academic exercise to be sure, but one which allows for useful comparisons between equities, sectors, and industries. Using our Valuation Model, we can currently assign a VE valuation calculation to more than 2900 stocks in our US Universe.

    We combine all of the equities with a valuation calculation to track market valuation figures and use them as a metric for making calls about the overall state of the market. Two factors can lower these figures-- a market pullback, or a significant rise in EPS estimates. Vice-versa, a significant rally or reduction in EPS can raise the figure. Whenever we see overvaluation levels in excess of @ 65% for the overall universe and/or 27% for the overvalued by 20% or more categories, we issue a valuation warning.

    We now calculate that 50.52% of stocks are overvalued and 15.04% of those stocks are overvalued by 20% or more. We saw overvaluation figures as low as 45% earlier this week. These sorts of figures are down significantly from where they were for much of 2014.

    With these sorts of numbers, we now operate well within "normal" range for valuation. We saw a brief dip into the 40s during October during the pre-election ISIS/Ebola scare, but other than that, the last time overvaluation was this low on a sustained basis was December 2012 when the S&P 500 was in the 1400s.

    The crash in oil prices has unsettled the markets, and volatility has returned at a time when money managers should be padding their results for the year with a traditional holiday uptick. We keep getting good economic news in the US, and are especially optimistic due to the--finally--improving labor picture. But the ruble crisis and the energy chaos has hurt equities, and the US may be effected by this contagion. For this reason, we cannot use the valuation figures to make a buy call just yet despite the vastly improved valuation picture.

    Subscribers Get FULL ACCESS to our Market and Sector Overviews

    The chart below tracks the valuation metrics from January 2014. It shows levels in excess of 40%.

    (click to enlarge)

    This chart shows overall universe over valuation in excess of 40% vs the S&P 500 from January 2013

    (click to enlarge)

    This chart shows overall universe under and over valuation in excess of 40% vs the S&P 500 from March 2007*

    (click to enlarge)

    *NOTE: Time Scale Compressed Prior to 2011.

    In addition to the overall valuation metrics, we see that on a sector basis overvaluation has greatly declined. Only nine sectors are overvalued according to our Valuation Model, and only one of them is overvalued by double digits. Oils/Energy is now calcualted to be undervalued by almost 30%.

    Tags: valuations
    Dec 18 12:23 PM | Link | Comment!
  • ValuEngine Rates Amazon And Other Top-Five Retail Stocks

    Valuation Watch: Overvalued stocks now make up 51.89% of our stocks assigned a valuation and 16.31% of those equities are calculated to be overvalued by 20% or more. Eleven sectors are calculated to be overvalued--with one sector at or near double digits.

    ValuEngine Index Overview

     

     

     

     

     

    IndexWeek OpenFriday PMChange% ChangeYTD
    DJIA17954.9417432.4-522.54-2.91%5.16%
    NASDAQ4769.764701.59-68.17-1.43%12.57%
    RUSSELL 20001179.961160.5-19.46-1.65%-0.27%
    S&P 5002074.842024.34-50.5-2.43%9.52%

     

    ValuEngine Market Overview

     

     


     

    Summary of VE Stock Universe
    Stocks Undervalued48.11%
    Stocks Overvalued51.89%
    Stocks Undervalued by 20%22.14%
    Stocks Overvalued by 20%16.31%
    ValuEngine Sector Overview

     
















    SectorChangeMTDYTDValuationLast 12-MReturnP/E Ratio
    Aerospace-0.20%-3.15%-3.14%13.48% overvalued4.02%21.99
    Consumer Staples0.24%-1.32%4.82%7.82% overvalued5.72%23.12
    Medical0.42%0.12%16.22%6.88% overvalued11.89%29.46
    Retail-Wholesale0.69%-2.25%-1.91%6.76% overvalued-0.60%26.51
    Consumer Discretionary0.47%-2.27%-2.59%6.76% overvalued-1.89%27.80
    Computer and Technology0.15%-1.45%5.27%6.75% overvalued3.07%30.65
    Multi-Sector Conglomerates-0.33%-4.18%-4.02%4.96% overvalued2.22%16.78
    Finance0.20%-0.99%3.68%4.55% overvalued3.70%17.88
    Utilities0.25%-1.22%6.24%2.94% overvalued7.49%21.15
    Business Services0.39%-2.13%2.85%1.87% overvalued1.28%25.77
    Transportation0.57%-3.66%8.82%0.42% overvalued6.70%19.90
    Auto-Tires-Trucks0.14%-3.68%-4.23%2.08% undervalued0.65%16.69
    Construction0.41%-1.81%-1.89%4.84% undervalued-0.54%24.82
    Industrial Products0.15%-1.94%-3.53%5.26% undervalued-2.72%19.60
    Basic Materials-0.48%-2.50%-6.60%14.06% undervalued-9.56%23.17
    Oils-Energy-1.46%-13.63%-17.35%26.63% undervalued-25.87%19.31

    ValuEngine Newsletters Latest Results

     

     

     

     

     

    VE NewsletterCurrent ResultsS&P 500Last Month TotalS&P 500Since InceptionS&P 500
    Forecast MNS-9.33-0.74-2.88.7183.29123.45
    Dividend Stock-5.56-2-1.595.9820.7833.19
    Small Cap Stock-11.09-1.986.227.2629.5849.04
    View-4.8-1.14.815.53125.180.91

    ValuEngine's Newsletters Beat the Market

    With our Investment Newsletters, Subscribers Harness the Power of all of ValuEngine.com's Extensively Tracked and Tested Portfolio Strategies in an Easy to Follow Format.

    Let ValuEngine Optimize your Portfolio and Provide Rational Advice for Smarter Investing

    Click HERE to Check Out ValuEngine's Investment Newsletters

    Free Download for Readers

    As a bonus to our Free Weekly Newsletter subscribers,
    we are offering a FREE DOWNLOAD of one of our Stock Reports

    Amazon.com, Inc. seeks to be the world's most customer-centric company, where customers can find and discover anything they may want to buy online. The company lists unique items in categories such as books, music, DVDs, videos, consumer electronics, toys, camera and photo items, software, computer and video games, tools and hardware, lawn and patio items, kitchen products, and wireless products.

    ValuEngine continues its STRONG SELL recommendation on AMAZON.COM INC for 2014-12-11. Based on the information we have gathered and our resulting research, we feel that AMAZON.COM INC has the probability to UNDERPERFORM average market performance for the next year. The company exhibits UNATTRACTIVE Book Market Ratio and P/E Ratio.

    Below is today's data on AMZN:


     






    ValuEngine Forecast
     Target
    Price*
    Expected
    Return
    1-Month302.61-1.54%
    3-Month293.92-4.37%
    6-Month279.90-8.93%
    1-Year250.41-18.53%
    2-Year281.98-8.26%
    3-Year335.449.14%

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Valuation & Rankings
    Valuation40.61% overvaluedValuation Rank(?) 6
    1-M Forecast Return-1.54%1-M Forecast Return Rank 1
    12-M Return-19.58%Momentum Rank(?) 27
    Sharpe Ratio0.68Sharpe Ratio Rank(?) 85
    5-Y Avg Annual Return18.26%5-Y Avg Annual Rtn Rank 85
    Volatility26.76%Volatility Rank(?) 69
    Expected EPS Growth160.82%EPSGrowth Rank(?) 91
    Market Cap (billions)142.31Size Rank 100
    Trailing P/E Ration/aTrailing P/E Rank(?) 25
    Forward P/E Ratio781.42Forward P/E Ratio Rank 1
    PEG Ratio2.96PEG Ratio Rank 12
    Price/Sales1.67Price/Sales Rank(?) 51
    Market/Book20.32Market/Book Rank(?) 6
    Beta1.05Beta Rank 49
    Alpha-0.29Alpha Rank 28

    As a bonus to our Newsletter readers,
    we are offering a FREE DOWNLOAD of one of our Stock Reports

    Read our Complete Detailed Valuation Report on Amazon HERE.

    Sector Talk--Retail/Wholesale

    Below, we present the latest data on Retail/Wholesale stocks from our Institutional software package (Pending:VEI). Top five lists are provided for each category. We applied some basic liquidity criteria--share price greater than $3 and average daily volume in excess of 100k shares.

    Top-Five Retail/Wholesale Stocks--Short-Term Forecast Returns





     

    TickerNameMkt PriceValuation(%)Last 12-M Retn(%)
    FLWS1800FLOWERS.COM7.54-21.6151.71
    IMINGRAM MICRO27.02-6.2516.17
    HLF*HERBALIFE LTD40.71-36.6-41.57
    CONNCONNS INC17.09-59.37-77.29
    CBKCHRISTOPHER&BNK4.91-46.03-30.85

    Top-Five Retail/Wholesale Stocks--Long-Term Forecast Returns





     

    TickerNameMkt PriceValuation(%)Last 12-M Retn(%)
    FLWS1800FLOWERS.COM7.54-21.6151.71
    IMINGRAM MICRO27.02-6.2516.17
    HLF*HERBALIFE LTD40.71-36.6-41.57
    CONNCONNS INC17.09-59.37-77.29
    CBKCHRISTOPHER&BNK4.91-46.03-30.85

    Top-Five Retail/Wholesale Stocks--Composite Score

     

     

     

     

     

     

    TickerNameMkt PriceValuation(%)Last 12-M Retn(%)
    FLWS1800FLOWERS.COM7.54-21.6151.71
    IMINGRAM MICRO27.02-6.2516.17
    MMACYS INC61.223.4117.55
    HLF*HERBALIFE LTD40.71-36.6-41.57
    GPSGAP INC39.89-4.294.1

    Top-Five Retail/Wholesale Stocks--Most Overvalued





     

    TickerNameMkt PriceValuation(%)Last 12-M Retn(%)
    DENNDENNY'S CORP10.2176.2643.4
    ODPOFFICE DEPOT7.5465.6642.53
    BBWBUILD-A-BEAR WK20.6860.68153.12
    NFLXNETFLIX INC334.6352-8.06
    SPLSSTAPLES INC16.149.591.39

    *NOTE: Despite its high rating by our models in some areas, HerbaLife (NYSE:HLF) is a problematic company for a variety of reasons. We have been avoiding this stock in our newsletter portfolios.

    Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Tags: FLWS, IM, HLF, CONN, CBK, M, GPS, DENN, ODP, BBY, NFLX, SPLS, AMZN, retail
    Dec 12 4:48 PM | Link | Comment!
  • U.S. Oil Prices Continue Plunge

    VALUATION WATCH: Overvalued stocks now make up 51.32% of our stocks assigned a valuation and 15.89% of those equities are calculated to be overvalued by 20% or more. Twelve sectors are calculated to be overvalued--with four at or near double digits.

    Greasing the Wheels

    --U.S. Oil Prices Continue Plunge

    Markets are facing unrest over oil, specifically cheap oil. As of today, the price of a barrel of Nymex crude is now below $60. At that price, oil is down more than 40% for the year. This should be good news since cheap energy helps consumers make ends meet for driving, heating, and a host of other activities. In addition, the dollar has been getting stronger, which should also be good news for US-based consumers.

    However, markets don't like this news, and the declines in oil contributed to a bad day on Wall St. Cheap energy threatens the recent boom in the US and elsewhere as shale gas and oil becomes less attractive and more uneconomical for recovery. Producers across the globe--OPEC-- are attempting to drive competition out, and thus they are keeping the taps turned on "high."

    We've seen some real changes in our valuations for Oils/Energy. Currently we find that the sector is undervalued by 23% and it leads our sectors in terms of undervaluation by a large margin. The next most undervalued sector, Basic Materials, is only calculated to be undervalued by 6.74%. As a comparison, undervaluation for the energy sector peaked at 15.92% during the brief market pull back in October of this year. In fact, for much of 2014, the sector was calculated to be overvalued anywhere between 15-20%.

    Cheaper energy and a strong dollar may undermine much of the economic growth we have seen on places like Texas, Oklahoma, North Dakota, Pennsylvania, and Ohio. This causes caution rather than confidence. But, at least in the short-term, it should be a boon for drivers at the pump, residents heating their homes, etc.

    Below, we provide top-five lists for Oil-related Industry stocks from our Institutional software package (Pending:VEI). We applied some basic liquidity criteria--share price greater than $3 and average daily volume in excess of 100k shares. .

    Keep in mind that the models cannot really take into account the overall price of oil, they are working off past market behaviorour and earnings estimates. A company with prior high and future predicted high earnings which has declined in significantly in price will appear more appealing from a valuation perspective.

    Top-Five Oil Industry Stocks--Short-Term Forecast Returns

     

     

     

     

     

     

    TickerNameMkt PriceValuation(%)Last 12-M Retn(%)
    EMESEMERGE ENRG SVC45.78N/A20.32
    PQPETROQUEST ENGY3.71-45.25-7.25
    AAVADV OIL&GAS LTD4.44N/A2.78
    PTRPETROCHINA ADR102.98-42.35-11.54
    UPLULTRA PETRO CP15.18-50.23-28.87

    Top-Five Oil Industry Stocks--Long-Term Forecast Returns

     

     

     

     

     

     

    TickerNameMkt PriceValuation(%)Last 12-M Retn(%)
    EMESEMERGE ENRG SVC45.78N/A20.32
    PQPETROQUEST ENGY3.71-45.25-7.25
    AAVADV OIL&GAS LTD4.44N/A2.78
    PTRPETROCHINA ADR102.98-42.35-11.54
    UPLULTRA PETRO CP15.18-50.23-28.87

    Top-Five Oil Industry Stocks--Composite Score

     

     

     

     

     

     

    TickerNameMkt PriceValuation(%)Last 12-M Retn(%)
    PTRPETROCHINA ADR102.98-42.35-11.54
    STOSTATOIL ASA-ADR17.05-35.63-26.25
    RDS.AROYAL DTCH SH-A63.95-8.54-6.23
    CAMCAMERON INTL47.54-34.7-13.37
    DVNDEVON ENERGY54.47-17.98-10.44

    Top-Five Oil Industry Stocks--Most Overvalued

     

     

     

     

     

     

    TickerNameMkt PriceValuation(%)Last 12-M Retn(%)
    NKANISKA GAS STRG3.3154.43-77.73
    ATLSATLAS ENERGY LP25.771.54-41.42
    POWRPOWERSECURE INT10.5363.35-35.28
    CVICVR ENERGY INC39.7552.063.43
    SYRGSYNERGY RES CP9.5648.530.95

    Find out what Wall Street Investment and Media Professionals already know,
    ValuEngine offers sophisticated stock valuation and forecast research as well as a variety of portfolio screening and creation tools.

    Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Tags: EMES, PQ, AAV, PTR, UPL, STO, RDS.A, CAM, DVN, NKA, ATLS, POWR, CVI, SYRG, oil, energy
    Dec 11 5:09 PM | Link | Comment!
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