♟ Are YOUR Stocks Overvalued?

 
WARBrought to you by The War Room
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Are YOUR Stocks Overvalued?
Karim Rahemtulla, Head Fundamental Tactician, Monument Traders Alliance
Pawn Chess Piece Speculate the right way.
 
War Room Open House (Closes Friday at MIDNIGHT)

This is one of your final opportunities to join us LIVE all week (April 12-16).

You can get all our free training...

All our market analysis...

And ALL our trade recommendations.

No cost... no obligation... no b.s...

But You MUST Respond by Friday at MIDNIGHT → Click Here to RSVP (While You Still Can)

 
Editor's Note: Your last chance! RSVP to The War Room Open House right now (expires at MIDNIGHT). You know all those daily winners you see below our Trade of the Day alerts? Well, you're now invited to see those trades happening for one full week - IN REAL TIME! It's 100% free... NO strings attached...

Deadline Notice: Due to the unique nature of this invitation, we'll be cutting off the RSVPs TONIGHT at midnight - NO excuses... NO extensions - so lock in your spot now!

- Bryan Bottarelli, Head Trade Tactician
 
 
Karim Rahemtulla
In 1996, Chairman of the Federal Reserve Alan Greenspan said this:
 
  • Irrational exuberance is unfounded market optimism that lacks a real foundation of fundamental valuation, but instead rests on psychological factors.
 
The market went on to reach its ultimate high three years later!

Was Greenspan wrong, or was the market right?

Well, both were wrong and right, but at different times. The market did go higher, but then it plunged severely, decimating investors who were long, especially in the tech sector.

The same thing happened between 2007 and 2009. The Great Recession was a period where the market fell the sharpest since the Great Depression. Again, the clues were plain to see early as real estate was bubbling higher, stocks were flying high and nothing seemed to be able to stop the euphoria.

Then it all crashed... and again, the stocks that crashed the hardest were the ones that were flying the highest in terms of valuation.

Valuation is a key historical measure for stocks. In a reasonable market with growth in the economy and stable interest rates, stocks will trade between 12 and 18 times forward earnings.

This factors in the growth in earnings, dividends and the level of interest rates. When rates are super low, like today, that number can be as high as 20 to 25 times earnings, where the S&P 500 is trading today. In a bear market or a high interest rate environment, you can expect that number to plunge to around eight times earnings.

Remember, I am talking about earnings, not revenues. In today's market, you have companies that are actually trading at multiples of revenues, not earnings. If they were trading at one times revenues for slower growth stocks or even seven or eight times revenues for super-high growth stocks, that would be within the norms.

But in today's market, we are seeing companies trade at 25, 50 and even 100 times revenues! That is beyond ridiculous, and history will show that these companies will fall back to Earth not with a thud, but with a massive BANG.

Go through your portfolio and make sure that if you own any company trading at more than 10 times revenue, you POSITION SIZE properly. The last place you want to be overweighted is in a stock that trades at multiples that are unsustainable. Sure, they look okay today because "everyone" owns them and is touting them. But when sh*t hits the fan, and it always does, you could see your investment literally evaporate overnight.

Action Plan: There's nothing wrong with speculating, but you must be smart about it. And in The War Room, we teach you how to do just that. If you missed signing up for The War Room Open House next week, this is your last chance. After today, you can't sign up, and you will miss out on all the excitement AND profitable trades - for FREE! Yes. For free. We will also show you how we trade and teach you, each day, how to speculate smartly with real-time tutorials, as well as real-time picks. Next week - ALL week - every single trade is FREE of charge! Click here to reserve your spot and join us for an experience you will never forget!

Yours in smart speculation,
Karim Rahemtulla Signature
Karim Rahemtulla, Head Fundamental Tactician
Monument Traders Alliance
 
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WAR Room Testimonials
  
WAR Rook Mark H. April 9, 2021, 9:35 a.m.
I opened GS at $7.9 {and closed} for $10.5, +33%. Thanks Bryan!
  
  
WAR King Roy April 9, 2021, 9:39 a.m.
Didn't have time to get out of HON yesterday. Got in at $3.00 and out at $9.00 for monster winner! Thank you BB!
  
 

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