YARP Means Buy in U.S. Stock Calls at Wells Fargo, BofA
Income-seeking investors need to look for “yield at a reasonable price” in U.S. stocks because they have become so expensive relative to earnings, according to Gina Martin Adams, an equity strategist at Wells Fargo Securities LLC. In a report Monday, she cited a narrowing of the gap between the S&P 500 Index’s earnings yield – the inverse of its price-earnings ratio – and dividend yield. Martin Adams followed the example of Savita Subramanian, chief U.S. equity strategist at Bank of America Corp.’s Merrill Lynch unit, who presented the theme in a July 11 report and used the acronym YARP.