DALLAS, June 15 /PRNewswire/ -- From an investment viewpoint, Retirement Advisors of America believes that the current environment offers an opportunity to contrast empirical evidence of today with that of late 2008 and consider key differences between the past and present dynamics. Pointing to current and estimated corporate earnings as of mid-May 2010 as reported by Standard & Poor's, in the chart below the firm sees an extremely favorable environment compared to late 2008. It believes if corporate earnings are healthy, the stock market is healthy more often than not, and if corporate earnings are contracting, the stock market generally follows the same path. "First and foremost, corporate earnings are the foundation for long term stock market valuation," notes Bart Roberson, President of Retirement Advisors of America. (Chart One: Quarterly S&P 500 Operating Earnings)
Retirement Advisors of America thinks that risk appetite improvement and capital expenditure plans are already feeding back into corporations that are beginning to expand production, and that this expanding production will expand payrolls. "As corporate profits improve, risk appetite and the ability to entertain future capital expenditures improve," states Jeremy Merchant, Vice President of Investments and Operations. The firm points to a chart from the U.S. Bureau of Labor statistics of non farm payrolls from May 2008 until May 2010 to corroborate this trend. "We fully expect this recovery trend within the labor market to continue during the second half of 2010," adds Merchant. (Chart 2: U.S. Bureau of Labor statistics)
From a portfolio standpoint, Retirement Advisors of America believes proper positioning must account for these fundamental trends in earnings and employment, and while news from Europe held the markets hostage in May 2010, these longer term fundamentals should prove positive from a market perspective.
About Retirement Advisors of America
Retirement Advisors of America, A PHH Investments Company, is a Registered Investment Advisor with national headquarters in Dallas, Texas. With assets of approximately, $1.6 billion, Retirement Advisors of America is dedicated to providing outstanding retirement planning, investment and wealth management to high net worth individuals. It is the oldest investment firm specifically focused on serving the retired airline market, and has a history that dates back more than 25 years. For more information about Retirement Advisors of America please visit www.retirementadv.com.
The information in this commentary is for general purposes only. Each investor has specific circumstances unique to their investment situation and as such should consult with their personal financial advisor before making any investment decisions. Investments in securities are volatile, subject to change, and any past performance in securities does not guarantee future results. The above charts and graphs are not recommendations for the purchase and sale of any security.
SOURCE Retirement Advisors of America