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3 Stocks To Buy In An Expensive Market – MarketWatch

June 23
15:10 2016

There’s always an event or two that can spook the stock market, and there are always gurus who say the sky is falling. But there’s no question that the stock market as a whole has gotten more expensive, which means a value-based approach to picking stocks is more likely to give you good performance, while lowering downside risk.

Back on May 20, 2014, we pointed out that the S&P 500 SPX, +0.86%  looked expensive, because it was trading for 14.2 times consensus 2015 earnings estimates. At the time, that was the highest forward price-to-earnings ratio (based on the estimate for the following calender year) for the index since 2007. Since then, the index has returned 16% and now trades at 15.5 times weighted aggregate consensus 2017 earnings estimates, according to FactSet.

Two years ago we spoke to David Bechtel, one of three principals of Barrow Funds. He co-manages the Barrow Opportunity Fund BALIX, -0.12% and the Barrow Long/Short Opportunity Fund BFSLX, +0.10% The Barrow Opportunity Fund is the renamed Barrow All-Cap Value Fund, but its investment objectives haven’t changed.

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