From this week’s Barron’s:
“After the recent market drop, 13 of the top 25 companies in the S&P 500 index trade at or below 10 times estimated 2011 profits.”
I have just one question regarding the above sentence: How reliable are 2011 earnings estimates? I mean, analysts have a hard time predicting next quarter’s numbers. How the heck can we put any faith in numbers that are a year and a half out? Not only that, think about how scary the economy is right now. With the deficit growing all the time and taxes most assuredly going up, I think it spells hard times for companies. Put me in the pessimistic camp right now.
Regardless, for those of you who are interested, I put their list into an Excel spreadsheet (click on it to see a bigger graphic):
Most of the companies are already up significantly since the article was published, which means they’re not the bargains they were just a few days ago.
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