Photo: Bloomberg TV
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.
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.
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