GOLDMAN SACHS: THE SELL-OFF IS A BUYING OPPORTUNITY
The recent deterioration in the global economy and the Euro do not have Goldman Sachs shaking in its boots. Their analysts remain firmly in the bull camp and see the recent downturn as a buying opportunity. They see the recent downturn as being orderly and consistent with past downturns in the beginning periods of recoveries:
“Developments over the past two weeks have not altered our fundamental view. The market has plunged 12% in four weeks, but remains 60% higher than in March 2009. The pull-back has been consistent with sell-offs that occurred in recoveries following bottoms in 1974, 1982, 1987, 1990 and 2002. The correction has been orderly in that sector returns have been exactly in-line with beta-adjusted expected performance.”
Goldman is still very bullish. Their analysts believe the market could rally 21% by mid-year and will ultimately finish the year 17% higher:
“We expect the S&P 500 to rise to 1300 by mid-year (+21%), before ending 2010 at 1250 (+17%).”
Source: Goldman Sachs
When was the last time when Goldman was bearish?
Unreal…
That analysis amounts to taking a SPX full year EPS estimate and slapping a hisorical multiple of 15 on it..
No chance in the world that the preexisting estimate might be too aggressive now or that the threat of deflation has ever had a negative impact on market multiples…
Never trust Goldman. Never forget they shorted while telling their clients to buy.
I have to agree Goldman is not to be trusted.
Is that analist called Abbey Cohen still working for Goldman Sachs ? She was a perma bull for many, many years. Or was she dumped because her credibility had gone down to zero ?
A Eur/USD going down means more trouble for China. The yuan is pegged to the USD, so the yuan ihas gone up against the euro as well in the last six months. No, that doesn’t bode well for the world economy. But Goldman Sachs says “”buy”" !
http://www.alternet.org/story/146819/