August 2, 2013

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VALUATION WARNING: Our models find that overvaluation is at levels typically seen when market pullbacks occur. Overvalued stocks now make up 77% of our stocks assigned a valuation and 46% of those equities are calculated to be overvalued by 20% or more. 15 of 16 sectors are calculated to be overvalued--13 of them by double digits. MARKET OVERVIEW

Index
DJIA NASDAQ RUSSELL 2000 S&P 500

Week Open
15557.14 3604.29 1047.13 1690.32

Thurs. Close
15628 3675.74 1059.88 1706.87

Change
70.86 71.45 12.75 16.55

% Change
0.46% 1.98% 1.22% 0.98%

YTD
19.26% 21.73% 24.79% 19.68%

Summary of VE Stock Universe

Stocks Undervalued Stocks Overvalued Stocks Undervalued by 20% Stocks Overvalued by 20% 22.95% 77.05% 9.73% 46.31%

SECTOR OVERVIEW
Sector
Aerospace Auto-Tires-Trucks Basic Materials Business Services Computer and Technology Construction Consumer Discretionary Consumer Staples Finance Industrial Products Medical Multi-Sector Conglomerates Oils-Energy Retail-Wholesale Transportation Utilities

Change
0.84% 0.96% 0.03% 1.14% 1.38% 1.03% 1.15% 0.84% 0.62% 1.28% 0.90% 1.35% 0.52% 1.31% 1.60% 0.65%

MTD
0.87% 1.05% 0.13% 1.23% 1.54% 1.12% 1.23% 0.92% 0.68% 2.72% 1.06% 1.40% 0.65% 1.43% 1.66% 0.78%

YTD
27.89% 41.16% 2.42% 76.40% 29.03% 33.19% 30.70% 18.08% 26.92% 37.04% 202.57% 8.62% 26.43% 36.16% 27.12% 18.48%

Valuation
22.20% overvalued 26.99% overvalued 5.88% undervalued 18.10% overvalued 22.77% overvalued 13.78% overvalued 25.55% overvalued 22.85% overvalued 20.63% overvalued 18.52% overvalued 20.29% overvalued 12.00% overvalued 5.79% overvalued 25.75% overvalued 15.66% overvalued 10.70% overvalued

Last 12MReturn
32.00% 46.70% -21.53% 25.72% 25.97% 36.84% 30.99% 22.19% 18.69% 29.35% 23.41% 17.16% 7.50% 39.46% 23.25% 11.20%

P/E Ratio
18.2 18.89 20.04 24.25 30.48 25.54 24.7 21.53 17.94 20.96 25.81 17.24 27.82 23.22 21.95 20.64

ValuEngine Newsletters Latest Results

VE Newsletter Forecast MNS Dividend Stock Small Cap Stock View Current Month Total
1.11 0.89 -2.80 2.58

S&P 500
1.45 0.67 0.86 1.83

Last Month Total

3.56 8.47 13.82 4.51

S&P 500
2.62 6.76 3.9 1.48

Since Inception
91.13 8.47 39.26 75.27

S&P 500
84.17 6.76 22.03 48.02

Sector TalkComputers and Technology

Below, we present the latest data on leading Computers and Technology Sector stocks from our Institutional software package (VEI). These results were filtered by market price and volume--no results below 3$/share or less than 100k shares/day volume.

Top-Five Computers and Technology Sector Stocks--Short-Term Forecast Returns

Ticker
BBRY IQNT AMD TQNT TNAV

Name
BLACKBERRY LTD INTELIQUENT INC ADV MICRO DEV TRIQUINT SEMICO TELENAV INC

Mkt Price
8.76 8.11 3.81 8.01 6.13

Valuation(%)
27.93 -14.15 -30.61 -20.07 294.76

Last 12-M Retn(%)

23.09 -39.79 -5.93 43.04 8.11

Top-Five Computers and Technology Sector Stocks--Long-Term Forecast Returns

Ticker
BBRY IQNT AMD TQNT TNAV

Name
BLACKBERRY LTD INTELIQUENT INC ADV MICRO DEV TRIQUINT SEMICO TELENAV INC

Mkt Price
8.76 8.11 3.81 8.01 6.13

Valuation(%)
27.93 -14.15 -30.61 -20.07 294.76

Last 12-M Retn(%)

23.09 -39.79 -5.93 43.04 8.11

Top-Five Computers and Technology Sector Stocks--Composite Score

Ticker
HPQ ROVI CYOU TSM DELL

Name
HEWLETT PACKARD ROVI CORP CHANGYOU.COM TAIWAN SEMI-ADR DELL INC

Mkt Price
26.23 19.43 33.17 17.25 12.95

Valuation(%)
4.02 -36.13 8.11 -0.27 -0.12

Last 12-M Retn(%)

48.53 44.89 66.1 24.28 9.88

Top-Five Computers and Technology Sector Stocks--Most Overvalued

Ticker
CRAY NIHD TNAV N CKSW

Name
CRAY INC NII HLDGS-CL B TELENAV INC NETSUITE INC CLICKSOFTWARE

Mkt Price
28.2 6.71 6.13 97.77 7.3

Valuation(%)
300 300 294.76 248.43 226.64

Last 12-M Retn(%)

148.02 -5.23 8.11 83.02 -2.28

Find out what Wall Street Investment and Media Professionals already know, ValuEngine offers sophisticated stock valuation and forecast research as well as a variety of portfolio screening and creation tools. If you are reading this you should sign up for ValuEngine's award-winning To Sign Up for a stock valuation and forecast FREE TRIAL, service Please Click HERE NO OBLIGATION, 30 DAY FREE TRIAL!

Free Download for Readers

As a bonus to our Free Weekly Newsletter subscribers, we are offering a FREE DOWNLOAD of one of our Detailed Stock Valuation Reports--this report is normally $25.00
This week's free download is our report on Bank of America (BAC). Bank of Americais one of the world's leading financial services companies. Bank of America provides individuals, small businesses and commercial, corporate and institutional clients across the United States and around the world new and better ways to manage their financial lives. The company enables customers to do their banking and investing whenever, wherever and however they choose.

ValuEngine continues its HOLD recommendation on Bank of America for 201308-01. Based on the information we have gathered and our resulting research, we feel that Bank of America has the probability to ROUGHLY MATCH average market performance for the next year. The company exhibits ATTRACTIVE Company Size but UNATTRACTIVE Volatility. Read our Complete Detailed Valuation Report on Bank of America HERE.

What's HotMarket Valuation Reaches High Levels, Valuation Warning Continues

The ValuEngine Valuation Model tracks more than 7000 US equities, ADRs, and foreign stock which trade on US exchanges. When EPS estimates are available for a given equity, our model calculates a level of mispricing or valuation percentage for that equity based on earnings estimates and what the stock should be worth if the market were totally rational and efficient--an academic exercise to be sure, but one which allows for useful comparisons between equities, sectors, and industries. Using our Valuation Model, we can currently assign a VE valuation calculation to more than 3600 stocks. We combine all of the equities with a valuation calculation to track market valuation figures and use them as a metric for making calls about the overall state of the market. Whenever we see levels in overvaluation levels in excess of @ 65% for the overall universe and/or 27% for the overvalued by 20% or more categories, we issue a valuation warning. We issued our latest valuation warning on May 8th. At that time, the S&P was at 1625. As of yesterday's close, we now calculate that 77% of stocks are overvalued and 46% of stocks are overvalued by 20% or more. These levels represent some of the highest we have ever tracked. These sorts of market overvaluation and overvalued by 20% or more figures exceed levels which have been correlated with market pull backs in the past. Two factors can lower them, a market pullback, or a rise in earnings and EPS estimates. The markets have been on quite a tear to the upside all Summer, so unless the market embarks on a downward leg and/or companies begin bigger earnings and analysts adjust their EPS estimates, we expect to see these figures remain high. Investors are reminded to remain cautious against a move to the downside. Keep a close eye on the market and consider booking some profits.

The chart below tracks the valuation metrics from January 2013 until today.

This chart shows overall universe under and over valuation in excess of 50% vs the S&P 500 from June 2012 to the present.

This chart shows overall universe under and over valuation in excess of 50% vs the S&P 500 from March 2007 to the present.

In addition to the overall valuation metrics, we see that on a sector basis 15 of 16 sectors are calculated to be overvalued. In the past, our Chief Market Strategist Richard Suttmeier has used the sector valuation figures to buttress his macro market calls. This is another indicator that investors should consider implementing additional risk management tools and/or booking some profits.

Suttmeier Says
--Commentary and Analysis from Chief Market Strategist Richard Suttmeier
If you have any comments or questions, send them to Rsuttmeier@Gmail.com Treasury Yields 10-Year--(2.714) Daily, weekly and semiannual value levels are 2.726, 2.788 and 3.227 with monthly, annual, monthly, annual and semiannual risky levels at 2.601, 2.476, 2.284, 1.981 and 1.719.

Commodities and Forex Comex Gold ($1310.8) Monthly and weekly value levels are $1229.7 and $1227.7 with daily, annual, quarterly and annual risky levels at $1318.0, $1599.9, $1603.0 and $1852.1. Nymex Crude Oil ($107.74) Daily, monthly and quarterly value levels are $104.72, $104.48 and $91.75 with weekly, semiannual and annual risky levels at $110.87, $109.84 and $115.23. The Euro (1.3204) Semiannual and quarterly value levels are 1.2477 and 1.1545 with weekly and annual pivots at 1.3259 and 1.3257, and daily, monthly and annual risky levels at 1.3306, 1.3313 and 1.4295. Major Indices Daily Dow: (15,628) Daily, weekly, quarterly and annual value levels are 15,571, 15,393, 14,288 and 12,696 with the August 1 all time high at 15,650.69, and monthly and semiannual risky levels at 16,188 and 16,490. S&P 500 (1706.9) Daily, weekly, quarterly and annual value levels are 1689.1, 1670.7, 1525.6 and 1348.3 with the August 1 all time high at 1707.85, and monthly and semiannual risky levels at 1742.5 and 1743.5. NASDAQ (3676) Daily, weekly, quarterly and annual value levels are 3638, 3554, 3284 and 2806 with a monthly pivot at 3663, the August 1 multi-year high at 3678.50, and semiannual risky level at 3759. NASDAQ 100 (NDX) (3126) Daily, monthly, weekly, quarterly and annual value levels are 3102, 3080, 3010, 2983 and 2463 with the August 1 multi-year high at 3128.67, and semiannual risky level at 3304. Dow Transports (6670) Daily, weekly, annual and quarterly value levels are 6421, 6420, 6346, 5925, 5469 and 5348 with the August 1 all time high at 6686.86, and monthly and semiannual risky levels at 7087 and 7104. Russell 2000 (1059.88) Daily, weekly, quarterly and annual value levels are 1046.13, 1037.98, 863.05, 860.25 and 809.54 with the August 1 all time high at 1060.96, and monthly and semiannual risky levels at 1092.24 and 1089.42. The SOX (486.60) Weekly, daily, quarterly and annual value levels are 479.02, 471.58, 468.27, 404.59 and 338.03 with monthly and semiannual risky levels at 513.89 and 533.56.

Dow Utilities: (509.06) Daily and weekly value levels are 504.39 and 500.04 with quarterly, semiannual, monthly and annual risky levels at 510.38, 523.33, 530.15 and 540.37. Stock of the Day Here is today's stock of the day from Richard Suttmeier's Morning Briefing Newsletter. First Solar (FSLR) ($48.15) First Solar manufactures solar modules with an advanced thin film semiconductor process that significantly lowers solar electricity costs. By enabling clean renewable electricity at affordable prices, First Solar provides an economic alternative to peak conventional electricity and the related fossil fuel dependence, greenhouse gas emissions and peak time grid constraints. Analysis First Solar has a Hold rating according to ValuEngine with fair value at $72.50, which makes the stock 32.1% undervalued, The ValuEngine one-year price target is $50.83. The daily chart for First Solar shows declining momentum with the stock between its 21-day and 50-day simple moving averages at $47.58 and $48.14, and above the 200-day simple moving average at $35.75. My semiannual value level is $39.45 with a monthly risky level at $52.13.

ValuEngine.com Tools and Services

We provide a variety of means for accessing ValuEngine market analysis and other content. You can find us on some of the leading financial media websites as well as the more popular social media services. While our own website ValuEngine.com provides access to lots of analysis--and you can always sign up to receive email daily and weekly bulletins HERE, some users prefer to download PDF reports of content while others prefer to garner info while browsing the web. Our Chief Market Strategist Richard Suttmeier is a prolific market observer and you can find his content in a variety of places. His weekly column on Forbes provides insights into his "Buy and Trade" strategy while his daily market analysis can be followed and accessed at Scribd, Twitter, and Minyanville. Senior Editor Steve Hach re-posts PDFs and web-accessible copies of Daily and Weekly ValuEngine bulletins at Seeking Alpha and Scribd. In most cases, you can receive notification of VE content posting by Suttmeier and Hach by following the ValuEngine feed on twitter @ValuEngine. Links for this content are provided below, you may also find these links on our website HERE

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