Tags: Siegel | earnings | S&P | 2 | 000

Penn Prof. Siegel: Strong Earnings Will Lift Dow to 18,000

Tuesday, 04 Mar 2014 09:02 PM

By Dan Weil

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Buoyant corporate earnings will send stocks higher, says Jeremy Siegel, a finance professor at the University of Pennsylvania.

Fair value for the Dow Jones industrial average is 18,000, or 10 percent above Tuesday's close of 16,395.88, he told CNBC. And fair value for the Standard & Poor's 500 Index is 2,000, or 7 percent above Tuesday's close of 1,873.91, Siegel said.

As for the Dow, "it could get there [to 18,000] by the year-end, it could get there sooner, it might be later," Siegel said. "But I certainly don't think that we're in the ninth inning of the bull market yet."

Editor’s Note: Secret ‘250% Calendar’ Exposed — Free Video

As for profits, reported earnings for companies in the S&P 500 rose 16 percent last year from 2012, Siegel said. "We didn't have a real good economy last year, and we got 16 percent earnings growth."

This year, earnings are expected to rise 20 percent, he said. "If any of these earnings estimates pan out—and they are bullish—hey, we're in about the fourth or fifth inning of this bull market," Siegel said. "This could be . . . much more than 18,000 on the Dow."

Others are bullish on stocks, too.

"On a very short-term basis, everything you’ve seen in the market has everything to do with the Ukraine," Kevin Caron, a market strategist at Stifel Nicolaus, told Bloomberg.

"But over last two weeks, the market has moved higher with the exception of [Monday]. The bet has been made that the economy continues to expand and most of the disruption we’ve seen has been from the weather."

Editor’s Note: Secret ‘250% Calendar’ Exposed — Free Video

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