Investors banking on a roaring bull market in U.S. stocks in 2022 are enjoying the company of an unexpected ally: valuations.
The S&P 500 rose 27% in 2021, capping a third consecutive year of double-digit gains. Yet stocks are cheaper than they were a year ago: The S&P is trading at 21 times analysts’ projected earnings over the next 12 months, down from 22.8 times at the end of 2020.