Mackenzie manager: Large-cap stock valuations stretched in developed economies

Consumer stocks have typically been a favourite for Matt Moody, but some have become too expensive.

Sonita Horvitch 26 August, 2015 | 5:00PM

Matt Moody, vice-president and portfolio manager on the Ivy team at Mackenzie Investments, says that valuations on the stocks of high-quality, larger-cap global companies headquartered in developed countries are stretched.

"The developed world's equity market is generally expensive by historic standards," says Moody, who is involved in managing the team's global and European equity portfolios.

At the end of July, the benchmark MSCI World Index, which represents 1,642 large and mid-cap companies across 23 developed markets, traded at a "fairly lofty" 19.6 times trailing 12-month earnings per share. By contrast, when using forward earnings per share at that date, the index's P/E multiple was 16.4 times.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar Rating
Colgate-Palmolive Co70.15 USD-3.80
Nike Inc B88.31 USD-4.02
Procter & Gamble Co113.50 USD-5.54

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Sonita Horvitch

Sonita Horvitch