Europe: Portfolio Strategy - The next leg: The path to mid-cycle valuation
June 18, 2009
Target of 420 for Stoxx 600 by year-end 2013
We estimate EPS of 28 euros by 2013, assuming that future earnings growth will drive the ROE back to its historical average of 11.4%. We anticipate a mid-cycle P/E multiple of 15x by feeding long-run assumptions on the economy through GS DDM. Historical experience suggests that the market may pay for some of this in advance.
>> Europe: Portfolio Strategy - The next leg: The path to mid-cycle valuation June 18, 2009 [PDF, 239 KB]