Randall Eley: No Bear Market in Foreseeable Future

By on March 26, 2012

Randall Eley - Edgar Lomax CompanyLong-time market observer Randall Eley, of the Edgar Lomax Company, was the guest market monitor on the latest Nightly Business Report.

The host, Tom Hudson, asked Eley whether the 11 percent rise for the market (S&P 500) so far this year was too much too fast. Eley replied it was absolutely, but he didn’t expect the market to experience sharp declines or a bear market in the foreseeable future.

Eley indicated that given that it was a presidential election year, declines would give those who were underinvested in the market an opportunity to do so.

Eley thinks there is a good chance the market will end up higher than where it is now (S&P 500 @ 1397), while warning they’re not market prognosticators.

Eley stated the fact is that governmental authorities, both the Federal Reserve and fiscal authorities, are very involved in the economy and the market to try to smooth things as much as possible. With money as easy as it is, it’s difficult for stocks to go down and stay down for the foreseeable future.

Hudson brought up Eley’s previous recommendation of health care giant Pfizer. Eley still considered it a good position considering its low PE ratio and high yield of 4 percent compared to the S&P 500’s yield of 2 percent. Eley added the yield provides cash coming enabling liquidity when prices begin to fall.

Hudson mentioned Eley’s pick of Intel, which at $27.88, is at its highest price since 2005. Eley said they prefer buying stocks when they are going down and would rather buy INTC at a lower price, but wouldn’t worry about overpaying for it until it was over $33.

Eley commented on his buy recommendation of ConocoPhillips which has a price to book value of 1.5; the same P/BV the S&P 500 had at the depths in 2009.

Hudson asked what Eley thought of his previous picks of Coca Cola and Exxon Mobil, both up from his last visit on 10/21/11. Eley indicated they were still good buys and they own all the stocks mentioned in the broadcast.

2 Comments

  1. The Sultan of Savannah

    March 26, 2012 at 8:38 pm

    I think it’s wonderful you elected to include an African American among your investment luminaries! Perhaps next year you”ll do the same (before March Madness begins).

    TSoS, Potent, Virile, Compassionate

  2. Barron Maestro

    March 27, 2012 at 2:47 am

    It was largely due to your prompting that I corrected this oversight. I was flummoxed when I perused the categories several weeks ago and recognized the error of my ways.

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