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The fundamentals for the Russell have continued to deteriorate,” said Sanchez, a CNBC contributor. “We’ve actually seen the P/E [price-to-earnings multiple] rising since Q2, not because the price is rising but because earnings estimates are being revised down more substantially than prices are falling. That’s a terrible sign.”
And about a quarter of the companies in the Russell 2000 aren’t profitable, Sanchez said. “Let’s keep that in mind when we’re thinking about what we want to be buying. I think you’re catching falling knives here. I think this is an opportunity to sell.” |
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