- The market looks overvalued but there are three main factors that could push it even higher.
- A repatriation tax holiday could make $2.1 trillion available for dividends, buybacks, and M&As.
- Economic growth and inflation could push earnings higher, further inflating stock prices.
It seems that everyone agrees on the fact that this market is overvalued and borderline irrational. However, there is no correction in sight and the only question to be asked is “how high can this market go?”
The S&P 500 has jumped 5.4% since Trump won the elections, and is 12.1% higher year-to-date. By adding in the 2% dividend yield, we arrive at an excellent 14% return for 2016. This year’s positive return will make it number eight in a row for the S&P 500 as it has been rewarding investors since 2009. More →