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Strategies & Market Trends : MARKET INDEX TECHNICAL ANALYSIS - MITA -- Ignore unavailable to you. Want to Upgrade?


To: Shack who wrote (10819)2/27/2002 12:25:43 PM
From: David Howe  Read Replies (1) | Respond to of 19219
 
<< should be trading at better than 25 times earnings >>

Why not? That implies a rate of return of around 4% and that's if earnings don't increase one nickle.

You can't get 4% in a savings account. Sure there's more risk, but there's upside as well, and upside is more likely. Loooong term, earnings will increase on average for the Dow stocks. So, that 4% improves over time.

Dave