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ValuEngine Weekly Newsletter June 3, 2011

ValuEngine Weekly Newsletter June 3, 2011

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Published by ValuEngine.com
This week, we provide VE data for the top-five ranked stocks for short-term forecast,long-term forecast,composite score, and overvaluation in the Finance Sector as well as Moody's warnings on banks, we discuss the latest Case-Shiller housing report and the home builders, and we get the latest on technical levels for Treasuries,Gold,Oil,the euro,and major indices from our Chief Market Strategist Richard Suttmeier. We also provide our Market and Sector Overviews as well as a link to a FREE download for one of ValuEngine's detailed valuation reports on Las Vegas Sands--these reports normally cost $25.00.
This week, we provide VE data for the top-five ranked stocks for short-term forecast,long-term forecast,composite score, and overvaluation in the Finance Sector as well as Moody's warnings on banks, we discuss the latest Case-Shiller housing report and the home builders, and we get the latest on technical levels for Treasuries,Gold,Oil,the euro,and major indices from our Chief Market Strategist Richard Suttmeier. We also provide our Market and Sector Overviews as well as a link to a FREE download for one of ValuEngine's detailed valuation reports on Las Vegas Sands--these reports normally cost $25.00.

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Categories:Business/Law, Finance
Published by: ValuEngine.com on Jun 03, 2011
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06/03/2011

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June 3, 2011
The ValuEngine Weekly is an Investor Education newsletter focused on the quantitative approach toinvesting and the tools available from 
In today's fast-moving and globalized financialmarkets, it is easy to get overloaded with information. The winners will adopt an objective, scientific,independent and unemotional approach to investing. If you are not yet a member of ValuEngine's stockanalysis service, sign up now for a two-week free trial atwww.valuengine.com!
MARKET OVERVIEW
 
Indexstarted weekThursday Close3 day change3 day change %ytd
DJIA
12443.412248.5
-194.9-1.57%5.80%NASDAQ
2824.252773.31
-50.94-1.80%4.54%RUSSELL 2000
843.32820.69
-22.63-2.68%4.73%S&P 500
1331.11312.94
-18.16-1.36%4.40%
Summary of VE Stock Universe
Stocks Undervalued 50.64%Stocks Overvalued 49.36%Stocks Undervalued by 20% 21.20%Stocks Overvalued by 20% 20.47%
 
SECTOR OVERVIEW
Sector Change MTD YTD Valuation Last 12-MReturnP/ERatio
Aerospace
0.18%0.20%11.65%0.67% overvalued24.64%18.44
Auto-Tires-Trucks
0.22%0.30%-9.40%0.98% undervalued46.91%18.62
Basic Materials
-0.01%0.04%-5.46%2.29% undervalued48.14%23.84
Business Services
0.24%0.40%3.53%4.42% overvalued16.38%36.89
Computer and Technology
0.11%0.16%8.82%2.40% overvalued34.92%44.47
Construction
-0.30%-0.27%-5.57%5.36% undervalued3.26%48.33
Consumer Discretionary
-0.05%0.09%3.47%0.76% overvalued15.71%29.09
Consumer Staples
-0.42%-0.36%-6.13%3.75% overvalued18.81%20.95
Finance
-0.16%-0.10%1.24%0.48% overvalued8.99%24.8
Industrial Products
-0.39%-0.31%-0.45%2.05% overvalued26.93%31.62
Medical
-0.04%0.02%15.42%2.22% overvalued19.79%34.71
Multi-Sector Conglomerates
0.80%0.91%2.40%7.58% overvalued33.10%27.44
Oils-Energy
-0.22%-0.19%1.11%8.01% overvalued45.12%48.24
Retail-Wholesale
-0.66%-0.57%4.19%2.33% overvalued22.80%34.68
Transportation
0.40%0.45%-3.51%1.59% overvalued18.90%19.66
Utilities
-0.05%-0.04%5.04%8.72% overvalued25.03%23.51
Sector Talk—Finance
Bad news for financial stocks this week as the Moody's Investors Servicereported that the era of "Too Big to Fail" may be over for some large institutions.
,Moody's has warned that it may issue a credit-rating cut for Bank of America (BAC), Citigroup (C), and Wells Fargo (WFC). Thereasons for the potential downgrades would include the removal of support from theFederal Government as the Dodd-Frank financial reform bill is implemented.Our proprietary valuation, forecast, and ratings for these three banks arebelow. Of the three, only Wells Fargo avoids a Sell rating. All three banks shownegative long-term forecast figures--with Wells Fargo again at the top of the heap at just slightly negative. On a valuation basis, Bank of America and Wells Fargo are far more attractive than Citigroup, which has pegged our overvaluation metric at 300%.For our fundamentally-based quantitative systems, Wells Fargo is not as problematicas Citigroup or Bank of America.
 
 Ticker Company NameMktPriceValuation(%)VERatingForecast1-MonRetn(%)Forecast1-Yr Retn(%)Last 12-MonRetn (%)5-Yr AvgRetn(%)P/ERatio
BAC
BANK OF AMER CP11.24-33.120.5-8.26-26.97-26.7814.88
C
CITIGROUP INC39.653001-2.61-23.83.01-2.98126.39
WFC
WELLS FARGO-NEW26.94-21.7731.58-0.2-3.68-3.3410.87
Below, we present the latest data on the rest of the Finance Sector Sector fromour 
Top-Five Finance Sector Stocks--Short-Term Forecast Returns
TickerNameMkt PriceValuation(%)Last 12-MRetn(%)
MI
MARSHALL&ILSLEY7.85-37.51-2.73
FAF
FIRST AMER FINL15.43-2.787.83
SNBC
SUN BANCORP/NJ3.75-62.87-18.48
SFE
SAFEGUARD SCTFC18.83-7566.64
NCT
NEWCASTLE INV5.29-70.8584.32
Top-Five Finance Sector Stocks--Long-Term Forecast Returns
TickerNameMkt PriceValuation(%)Last 12-MRetn(%)
MI
MARSHALL&ILSLEY7.85-37.51-2.73
SNBC
SUN BANCORP/NJ3.75-62.87-18.48
FAF
FIRST AMER FINL15.43-2.787.83
MIM
MI DEVLPMNTS -A30.62 N/A139.97
SFE
SAFEGUARD SCTFC18.83-7566.64
Top-Five Finance Sector Stocks--Composite Score
TickerNameMkt PriceValuation(%)Last 12-MRetn(%)
UBS
UBS AG19.18-41.1843.13
ING
ING GROEP-ADR11.84-37.7348.56
MCO
MOODYS CORP39.69-13.87102.71
AMP
AMERIPRISE FINL58.99-15.748.51
SFE
SAFEGUARD SCTFC18.83-7566.64

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