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Politics : Formerly About Applied Materials
AMAT 240.80+4.6%Nov 5 3:59 PM EST

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To: Jacob Snyder who wrote (53902)10/7/2001 10:29:17 AM
From: Proud_Infidel  Read Replies (2) of 70976
 
The LT range for the S&P 500, is to stay in a PE range of 10-20, with a LT average of 15. In recessions, it can be expected to hit a PE of 10

To answer the market valuation question, I believe one should create a basket of stocks for comparison. Many in the Nasdaq 100 are still trading at enormous PSR's and give the impression that the "market" is overvalued, which is incorrect IMO. For example, look at ORCL and MSFT, with PSR's of nearly 7 and 11, respectively, and compare that to a GLW or an AMAT, which carry PSR's of 1.07 and 2.7, respectively. One cannot make broad statements about an overall market over or under valuation when so many are trading near historic troughs, while a few still expensive issues skew the numbers.

Brian
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