June 24, 2016

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VALUATION WATCH: Overvalued stocks now make up 47.55% of our

stocks assigned a valuation and 16.86% of those equities are calculated to
be overvalued by 20% or more. Eight sectors are calculated to be
overvalued.
MARKET OVERVIEW
Index

Started week

Friday AM

Change

Change %

ytd

DJIA

17736.87

17531.7

-205.17

-1.16%

0.61%

NASDAQ

4856.69

4750.25

-106.44

-2.19%

-5.14%

RUSSELL 2000

1146.39

1138.55

-7.84

-0.68%

0.23%

S&P 500

2075.58

2053.64

-21.94

-1.06%

0.47%

Summary of VE Stock Universe

Stocks Undervalued

52.45%

Stocks Overvalued

47.55%

Stocks Undervalued by 20%

22.87%

Stocks Overvalued by 20%

16.86%

SECTOR OVERVIEW
Sector

Change

MTD

YTD

Valuation

Last 12-M
Return

P/E
Ratio

Aerospace

0.37%

-1.53%

-3.36%

1.29% overvalued

-4.31%

19.09

Auto-Tires-Trucks

1.41%

-0.36%

-0.48%

6.83% undervalued

-17.11%

12.15

Basic Materials

1.66%

5.40%

35.64%

11.20% overvalued

19.99%

29.04

Business Services

1.13%

0.55%

9.42%

1.05% undervalued

-9.06%

23.12

Computer and Technology

1.58%

1.14%

6.96%

1.03% overvalued

-9.22%

28.3

Construction

0.94%

-0.17%

19.36%

2.42% undervalued

-5.31%

21.07

Consumer Discretionary

1.08%

0.59%

3.22%

1.16% undervalued

-12.21%

22.78

Consumer Staples

0.99%

1.91%

6.71%

11.40% overvalued

3.24%

23.96

Finance

1.33%

0.13%

2.53%

1.60% undervalued

-5.33%

16.05

Industrial Products

1.80%

2.02%

7.73%

4.85% overvalued

-8.78%

21.47

Medical

1.32%

-0.40%

-6.50%

7.59% undervalued

-23.44%

27

Multi-Sector Conglomerates

1.62%

1.46%

5.95%

5.42% overvalued

-7.49%

18.18

Oils-Energy

2.11%

4.29%

15.44%

8.79% overvalued

-29.30%

22.97

Retail-Wholesale

0.95%

0.89%

-2.82%

9.70% undervalued

-14.37%

22.38

Transportation

1.55%

-0.09%

1.94%

5.83% undervalued

-27.25%

13.49

Utilities

1.73%

2.98%

9.24%

8.48% overvalued

3.85%

23.65

Sector TalkTransportation
Below, we present the latest data on leading Transportation Sector stocks from
our Professional Stock Analysis Service. We applied some basic liquidity criteria-share price greater than $3 and average daily volume in excess of 100k shares. We
have been following the sector closely of late because it has been correlated so
tightly to overall equity price moves.

Top-Five Transportation Sector Stocks--Short-Term Forecast Returns

Ticker

Company Name

Market Price

Valuation

Last 12-M Retrn

HA

HAWAIIAN HLDGS

36.92

-18.11%

51.75%

VA

VIRGIN AMERICA

56.26

N/A

89.81%

VLRS

CONTROLADORA VL

17.79

N/A

44.05%

LUV

SOUTHWEST AIR

39.59

-19.00%

14.49%

SKYW

SKYWEST INC

25.64

21.34%

61.66%

Top-Five Transportation Sector Stocks--Long-Term Forecast Returns

Ticker

Company Name

Market Price

Valuation

Last 12-M Retrn

HA

HAWAIIAN HLDGS

36.92

-18.11%

51.75%

VA

VIRGIN AMERICA

56.26

N/A

89.81%

VLRS

CONTROLADORA VL

17.79

N/A

44.05%

LUV

SOUTHWEST AIR

39.59

-19.00%

14.49%

SKYW

SKYWEST INC

25.64

21.34%

61.66%

Top-Five Transportation Sector Stocks--Composite Score

Ticker

Company Name

Market Price

Valuation

Last 12-M Retrn

LUV

SOUTHWEST AIR

39.59

-19.00%

14.49%

HA

HAWAIIAN HLDGS

36.92

-18.11%

51.75%

DAL

DELTA AIR LINES

38.31

-38.01%

-11.11%

ALK

ALASKA AIR GRP

59.14

-27.46%

-11.09%

UAL

UNITED CONT HLD

45.17

-13.46%

-18.21%

Top-Five Transportation Sector Stocks--Most Overvalued

Ticker

Company Name

Market Price

Valuation

Last 12-M Retrn

YRCW

YRC WORLDWD INC

9.37

300.00%

-32.59%

BRS

BRISTOW GROUP

14.25

300.00%

-73.45%

GLOG

GASLOG LTD

13.05

79.29%

-37.77%

ATSG

AIR TRANSPT SVC

13.86

76.18%

31.87%

TAL

TAL INTL GRP

13.64

73.18%

-62.11%

Find out what Wall Street Investment and Media Professionals already know,
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Free Download for Readers

As a bonus to our Free Weekly Newsletter subscribers,
we are offering a FREE DOWNLOAD of one of our Stock Reports
The Boeing Company (BA) is one of the world's major aerospace firms. The
company operates in three principal segments: commercial airplanes; military aircraft
and missiles; and space and communications.
ValuEngine continues its HOLD recommendation on BOEING CO for 2016-06-23.
Based on the information we have gathered and our resulting research, we feel that
BOEING CO has the probability to ROUGHLY MATCH average market performance
for the next year. The company exhibits ATTRACTIVE Company Size but UNATTRACTIVE
Book Market Ratio.
Read our Complete Detailed Valuation Report on Boeing HERE.

ValuEngine Forecast
Target
Price*

Expected
Return

1-Month

133.69

0.10%

3-Month

134.44

0.67%

6-Month

135.77

1.66%

1-Year

135.21

1.24%

2-Year

142.34

6.58%

3-Year

140.25

5.02%

Valuation & Rankings

Valuation

1.82% undervalued

Valuation Rank(?)

1-M Forecast Return

0.10%

1-M Forecast Return Rank

12-M Return

-7.53%

Momentum Rank(?)

52
59
53

Sharpe Ratio

0.45

Sharpe Ratio Rank(?)

83

5-Y Avg Annual Return

9.61%

5-Y Avg Annual Rtn Rank

81

Volatility

21.16%

Volatility Rank(?)

Expected EPS Growth

17.13%

EPS Growth Rank(?)

Market Cap (billions)

95.21

Size Rank

Trailing P/E Ratio

17.03

Trailing P/E Rank(?)

Forward P/E Ratio

14.54

Forward P/E Ratio Rank

PEG Ratio

0.99

PEG Ratio Rank

Price/Sales

0.99

Price/Sales Rank(?)

Market/Book

23.19

Market/Book Rank(?)

73
56
100
69
57
44
66
6

Beta

1.11

Beta Rank

39

Alpha

-0.10

Alpha Rank

42

What's Hot
BREXIT
One gets the sense that there are a lot of voters in the UK re-evaluating their
votes from yesterday right now. As of this writing, we've seen some panic selling
across the globe as the "leave" victory has caught many by surprise. Many analysts
were attributing last week's gains as indicative of positive "remain" sentiment.
This move by the elderly, lower-educated, less-cosmopolitan, and more
xenophobic demographics in the UK will have unforeseen consequences for sure.
Right now, we have seen a crash in the Pound, the above-mentioned stock sell off,
and a lot of worry for the future of the EU-- and even the UK itself.
What lessons can be learned here? Don't underestimate the power of the
xenophobic, nationalistic, and populist appeal. It has a way of biting one in the "rear"
as elites in all walks of life have fallen radically out-of-touch with those bearing the
brunt of their policy failures, the economic crises, austerity measures, etc.
In the US, that brings us to one Mr. Donald J. Trump. His kind/supportive words
for the Brexit vote results today--and those from a variety of conservatives motivated
by the same issues as many of the "leave" voters "across the pond" --indicate a
certain fuzzy grasp on reality.

For now, as has been the case throughout the Obama administration, the US
remains the currency, economy and stock market of last resort. One expects a
stronger dollar, a lower market--for now--and a continued policy of easy money. It is
hard to imagine the Fed raising rates now, and one would expect that the "leave"
voters and the resultant chaos just locked in current monetary policy until after the
presidential election--at least. And, one wouldn't be surprised to see lower rates in
many countries as a response.
As always, remember that the panic moment is the almost always the worst
time to dump assets. Even though it is counter intuitive, it would be best to stand pat,
or even buy right now--when "blood is in the streets." Of course, that may be tough for
many who have been through so much of late, but try not to dump holdings and lock
in losses that should be temporary.

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