Golub reasons that investors aren't paying enough for a growth premium, so expensive large-cap stocks will outperform the pack if the equity market rallies. This seemingly illogical strategy might just work.
Here are 10 of the most expensive S&P 500 stocks based on forward earnings multiples. They receive terrible ratings from analysts, with low proportions of "buy" ratings. But, they will probably be the first stocks upgraded if economic growth picks up.
10. Regions Financial (RF) is a commercial, retail and mortgage bank. Its second-quarter loss widened to $277 million, or 28 cents a share, as revenue dropped 16% to $1.9 billion. The gross margin climbed from 4% to 11%. Regions has $7.4 billion of cash and $18 billion of debt. Its stock trades at a book value multiple of 0.5, a sales multiple of 1.2 and a cash flow multiple of 3 -- 60%, 35% and 68% discounts to industry averages. Of analysts following Regions, two advise purchasing its shares, 17 recommend holding and four suggest selling.Bullish Scenario: Credit Suisse (CS) offers a price target of $10, implying an advance of 35%.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV