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Cooperman on the Market: Insights from the Delivering Alpha Conference

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Delivering Alpha Conference 2017

Many fund managers, billionaire investors, and market leaders gathered at the Delivering Alpha Conference on September 12, 2017, in New York City’s Pierre Hotel. The conference was presented by CNBC and Institutional Investor, and some of the prominent names included Ray Dalio, Leon Cooperman, Marc Lasry, Jeffrey Smith, Stephen A. Schwarzman, and Jamie Dimon.

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Cooperman at the Delivering Alpha Conference

Legendary investor Leon Cooperman shared his view on the market (IWM) (QQQ), oil prices (USO) (UCO), and his favorite stock picks at the conference, stating that the “market is in [a] zone of fair, full valuation. I see very few signs of exuberance.”

To be sure, the S&P 500 Index (SPY) has shown a strong rally so far this year, returning ~11.4% on a YTD (year-to-date) basis, as of September 12, 2017. The index is currently trading at a trailing PE (price-to-earnings) ratio of ~22.2x. In the past 12 years, the average PE multiple of the index was 16.9x. The forward PE multiple of the index is 18x.

The higher multiples of the S&P 500 index compared with its historical data indicates that the index is trading at a marginally higher valuation than before. The higher valuation has been supported by strong earnings growth over the past two quarters.

Notably, Cooperman also stated that he sees very few signs of excitement in the recent market rally but that excitement could come if any major reforms take place in the near future.

In the next part of this series, we’ll discuss Cooperman’s view of crude oil prices.

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