Which Sectors Look the Best
Wednesday, September 23, 2009
David Rosenberg has an answer:
We ran screens looking at three variables:
- Equity sectors that have seen the least pronounced jump in price-earnings multiples (a sign of neglect).
- Equity sectors that have seen the most pronounced increase in earnings revisions in recent months (signs of improved fundamentals).
- Equity sectors that have the lowest analyst earnings growth estimates for 2010 (a low hurdle to jump across).
The envelope please …
…the winners would be consumer staples, health care and technology.
Note that these three sectors should also benefit from a weaker U.S. dollar (currency translation effect) given their relatively high share of foreign-derived revenues. We may not be bullish on the overall market, but it does not mean that investors should completely shun the space … there are specific opportunities out there.
Tags: david rosenberg, investing
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