7/29/2019 ValuEngine Issues Market Valuation Warning

1/3

February 4, 2013

ATTENTION Investors and Finance Professionals:

If you are reading this you should sign up for ValuEngine's award-winning stock valuation andforecast service at the low price of $19.95/month!

NO OBLIGATION, 30 Day FREE TRIAL!

VALUATION WARNING: Our models find that overvaluation is at

levels typically seen when market pullbacks occur. Overvaluedstocks now make up 65% of our universe and 27% of the

universe is calculated to be overvalued by 20% or more.

ALL sectors are calculated to be overvalued.

Valuation WARNING is ON

ValuEngine Issues Market Valuation Warning

ValuEngine has issued a market valuation warning as of today, February

4th. Our overall market overvaluation and overvalued by 20% or more figures havereached levels which have been correlated with market pull backs in the past. This is

a time for investors to keep a close eye on the market and to consider booking some

profits and perhaps hedging against a move to the downside.

The ValuEngine Valuation Model tracks more than 8000 US equities, ADRs, and

foreign stock which trade on US exchanges. The model calculates a level of

mispricing or valuation percentage for each equity based on 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.

We track market valuation figures and use them as a metric for making callsabout the overall state of the market. Whenever we see levels in 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. As of Friday's close, we now calculate

that 65.16% of stocks are overvalued and 27.42% of stocks are overvalued by 20% or

more.

http://www.valuengine.com/pub/main?p=33http://www.valuengine.com/pub/main?p=33http://www.valuengine.com/pub/main?p=33http://www.valuengine.com/pub/main?p=33https://www.facebook.com/pages/ValuEngine-Inc/111602408163http://twitter.com/ValuEnginehttp://www.valuengine.com/pub/main?p=24http://www.valuengine.com/pub/main?p=33http://www.valuengine.com/pub/main?p=33http://www.valuengine.com/pub/main?p=33http://www.valuengine.com/pub/main?p=33http://www.valuengine.com/pub/main?p=33

7/29/2019 ValuEngine Issues Market Valuation Warning

2/3

Subscribers Get FULL ACCESSto our Market and Sector Overviews

The chart below tracks the valuation metrics from June 2012 until today.

This chart shows overall universe valuation in excess of 60% vs the S&P 500 from

the end of March 2010 to the present. Here you can see the market metrics from our

last series of Valuation Watches and Warnings.

http://www.valuengine.com/pub/VeSubscribeInfohttp://www.valuengine.com/pub/VeSubscribeInfohttp://www.valuengine.com/ve/MarketViewhttp://www.valuengine.com/ve/ResearchSectorhttp://www.valuengine.com/images/newsletter/weekly/130128medval.pnghttp://www.valuengine.com/images/newsletter/weekly/130128shrtval.pnghttp://www.valuengine.com/pub/VeSubscribeInfohttp://www.valuengine.com/ve/MarketViewhttp://www.valuengine.com/ve/ResearchSector

7/29/2019 ValuEngine Issues Market Valuation Warning

3/3

In addition to the overall valuation metrics, we see that on a sector basis ALL

sectors are calculated to be overvalued. Ten of them are calculated to be

overvalued by 10% or more with four of them calculated to be more than 20%

overvalued. In the past, our Chief Market Strategist Richard Suttmeier has used thesector valuation figures to buttress his macro market calls. This is another indicator that

stocks are no longer the bargain they were a few months ago and that investors

should consider implementing additional risk management tools and/or booking

some profits.

Market Overview

Summary of VE Stock Universe

Stocks Undervalued 34.84%

Stocks Overvalued 65.16%Stocks Undervalued by 20% 14.37%

Stocks Overvalued by 20% 27.42%

Sector Overview

Sector Change MTD YTD Valuation Last 12-MReturn

P/ERatio

Aerospace 0.77% 0.82% 5.59% 7.12% overvalued 6.55% 14.56

Auto-Tires-Trucks 1.01% 1.06% 7.19% 8.64% overvalued 4.69% 15.5

Basic Materials 0.42% 0.52% 4.30% 7.82% overvalued -23.15% 31.7

Business Services 0.74% 0.81% 7.21% 11.95% overvalued 9.43% 31.12

Computer and Technology 1.20% 1.31% 8.04% 16.99% overvalued 3.08% 40.06

Construction 0.45% 0.49% 9.14% 24.44% overvalued 27.91% 43.5

Consumer Discretionary 0.38% 0.48% 8.13% 10.30% overvalued 10.52% 27.95

Consumer Staples 0.59% 0.73% 5.57% 28.84% overvalued 12.16% 23.95

Finance 0.76% 0.81% 7.51% 18.15% overvalued 16.29% 22.84

Industrial Products 0.29% 0.60% 6.57% 22.56% overvalued 5.63% 24.93

Medical 0.68% 0.81% 7.34% 17.61% overvalued 9.25% 32.1

Multi-Sector Conglomerates 0.60% 0.64% 4.27% 9.43% overvalued 13.08% 14.93

Oils-Energy0.71% 0.80% 8.50% 8.14% overvalued -9.78% 41.3

Retail-Wholesale 1.18% 1.91% 9.86% 16.97% overvalued 17.38% 37.11

Transportation 0.51% 0.54% 11.14% 25.29% overvalued 5.83% 25.9

Utilities 1.23% 1.48% 7.51% 8.62% overvalued 9.29% 18.02