The current bull market should broaden and endure, according to economist Ed Yardeni, who challenges analogies to the dot-com bubble.
"The naysayers have been comparing the current bull market to that of the late 1990s. Our comparison of the two shows fewer excesses in the current bull market so far," he wrote in his market commentary late Monday.
The bull market didn't start on March 31 this year but on Oct. 12, 2022, he wrote.
"Since then, most market segments have delivered solid double-digit gains. The problem is that several large-cap technology companies have delivered triple-digit gains, thereby making the double-digit growers appear to be underperformers. Nevertheless, even without the outperformers, it would still have been a solid bull market since October 12, 2022," Yardeni said.
He acknowledged that the Buffett Ratio, or Buffett Indicator — a comparison of the broad U.S. stock market's value to gross domestic product, introduced by Warren Buffett, Berkshire Hathaway's chairman and former CEO — is at a "record high." That would suggest that the market is significantly overvalued.
"We respect Buffett and his ratio," Yardeni said. "Nevertheless, we remain bullish."
He recently raised his year-end price target for the S&P 500 to 8,250 from 7,700.
Check out the gallery to see why this bull run differs from the late 1990s froth, according to the Yardeni Research president and chief investment strategist.
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