My mentor in the business always said: eat the meat of the sandwich and let the greedy guys take the crust. This was sage advice 30 years ago, and still holds true today. With the S&P 500 trading at almost 18 times 2015 and 16 times 2016 earnings Granite Group believes the S&P is fully valued. First call estimates have come down from their original earnings forecasts for this year and next. Even though technicians are calling for higher highs, we believe stock valuations have taken into account most of the good news.
Our perspective, let the greedy guys have the crust and wait for a better entry point into the markets.