Corporate Earnings Make U.S. Stocks Seem Cheap
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“Stocks look cheap relative to corporate profits” by at least one barometer of U.S. shares, according to James W. Paulsen, Wells Capital Management Inc.’s chief investment strategist.
The CHART OF THE DAY shows his gauge: the ratio of the Standard & Poor’s 500 Index to after-tax earnings for all U.S. companies, as compiled quarterly by the Commerce Department, in billions of dollars.