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When Tom Lee speaks, people make fun.Lee, the top equity strategist at JP Morgan, has earned a reputation for being a perma-bull (i.e. someone who spends way more time being bullish than bearish).
And he has gotten a lot of grief for that.
Just over a year ago, Lee unveiled his 2012 stock market outlook, and as expected it was more bullish than the consensus.
His year-end target for the S&P 500 was 1,430, up 13 per cent from where it closed in 2011.
“This is based on a target multiple of 13.0x estimated 2013 EPS of $110,” he wrote back then. “From any historical lens, this P/E multiple appears conservative.”
Well, the S&P 500 closed at 1,430 today.
Sure, there’s still a few more days left in 2012. But at the very least, you won’t be able to say that he wasn’t close.
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It’s worth noting that 2011’s most accurate forecaster, Morgan Stanley’s Adam Parker, is more off than any of his peers this year. Parker was looking for the S&P 500 to end 2012 at 1,167.Where Lee was right about market multiples this year, Parker was wrong.
“Only the hubristic deign to project the market multiple — and those who “accidentally” get it right for a year, like us in 2011, and potentially develop exaggerated confidence — as evidently we did this year in projecting another year of multiple contraction,” wrote Parker recently.