Out of balance? Growth versus yield in US valuations

Investors paying premium for high-yielding companies

In today's highly uncertain market environment, investors in US stocks are paying a premium for companies with high dividend yields.

But how much is too much - especially if interest rates stop declining? Stocks with resilient high-growth profiles deserve a closer look. The hunt for yield continues to create market distortions. While the price/forward earnings (P/FE) ratio of the S&P 500 is close to its long-term average, sector valuations look imbalanced. Will US equity bull market continue? Stocks that are sensitive to interest rates and yield are being pushed up as the 10-year US Treasury yield has dropped back down to 1.5%. At the end of August, most US sectors with dividend yields higher than the S&P 500...