European P/E Multiples Lowest Since 1980?s [Charts]

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By StreetofWalls

European markets are now fully pricing in an economic recession, analysts are expecting a recession but believing stocks can go higher.

Main takeaways on European Equities:

This Tiger grand-cub was flat during Q2 but is ready for the return of volatility

Tiger Legatus Master Fund was up 0.1% net for the second quarter, compared to the MSCI World Index's 7.9% return and the S&P 500's 8.5% gain. For the first half of the year, Tiger Legatus is up 9%, while the MSCI World Index has gained 13.3%, and the S&P has returned 15.3%. Q2 2021 hedge Read More


  1. Expect a recession to have begun in the fourth quarter of 2011
  2. Expect earnings estimates to be lowered about 5%
  3. …BUT expect stocks to go higher about 10-15% given that equity risk premium priced into market is near 2009 peak and P/E valuatoins near their lowest levels since the 1980?s.

Barclays is out with a really interesting graph of European Cyclically Adjusted P/E (CAPE) Multiples, graph points to multiples lowest since the 1980?s:

Disclosure: I do not have a position in any stocks mentioned in this article, do not have a plan to initiate a position within the next 72 hours.
Disclaimer:  The information, opinions, material, and any other content provided in this article is for informational purposes only and is not to be used or considered an offer or solicitation to buy or sell securities, investment products, financial instruments, or to participate in any particular investment strategy. The information, opinions, material, and any other content provided in this article does not constitute as a recommendation or as advice to buy or sell securities, investment products,  financial instruments, or to participate in any particular investment strategy.

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