Europe Equities
Today’s price sits at the 71.2th percentile of modeled fair value — 29% of modeled scenarios put fair value above the market.
- Median fair value
- 93.0
- Upside to median
- -7.0%
- Last close
- $87.21
- Confidence
- moderate-high
Return distributions, not point forecasts
Percentiles describe the spread of scenario outcomes under the stated method. The width of the range carries as much information as the midpoint.
One year
modeled- P90
- +27.5%
- P75
- +17.8%
- Median
- +7.0%
- P25
- -4.8%
- P10
- -15.5%
66% of modeled scenarios end positive.
Forward income of about 2.9%, sustainable earnings growth of about 7% from fiscal and defence spending and bank profitability, and a negative multiple adjustment of roughly 2.5 points reflecting the modeled fair-value gap; dispersion widened for the unhedged currency translation faced by a dollar investor.
Three years, annualised
modeled- P90
- +13.0%
- P75
- +9.5%
- Median
- +6.0%
- P25
- +2.5%
- P10
- -2.0%
Three-year annualised total return with a larger share of the fair-value gap assumed to close, partial normalisation of bank returns on equity as policy rates fall, and continued fiscal support to nominal growth.
Against the Treasury hurdle
- 1y Treasury
- 4.49%
- Modeled excess
- +2.5%
- Basis
- direct
The modeled one-year median total return of 7.0% exceeds the 4.49% one-year Treasury par yield by 2.51 percentage points. For a dollar investor that spread is also exposed to the euro, which the model treats as a source of dispersion rather than of expected return.
6 in this asset class
| Symbol | Valuation | Fair value | Last close | 1y modeled |
|---|---|---|---|---|
| EWU United Kingdom Index | +0.2Fair | 101.0 | $47.76 | +8.5% |
| EWL Switzerland Index | -0.4Somewhat expensive | 98.0 | $62.00 | +7.0% |
| EWQ France Index | -0.9Somewhat expensive | 95.0 | $42.26 | +7.0% |
| VGK Europe Broad Market | -1.3Expensive | 93.0 | $87.21 | +7.0% |
| EZU Eurozone Equity Index | -1.4Expensive | 92.0 | $66.02 | +7.0% |
| EWG Germany Index | -1.7Expensive | 90.0 | $41.54 | +6.5% |