Bill Miller sees room to grow for stock prices and earnings

The market's up about 90% or more from the bottom, but earnings are up about 90% from the bottom. So, we're really looking at a market where forward twelve earnings multiples are not much higher than they were at the bottom. The difference of course is that the market as a percent of GDP is a lot higher than it was then, so the slack is not what it was. But you still have great values in this overall market.

You're going to see margin headwinds and that kind of thing and also just consumption, because of oil prices, will be a bit of a drag. But at the end of the day, you're looking at companies with great free cash flow yields and rising dividends and low P/E ratios and I think the overall earnings growth is not going to be what we've seen but you'll see earnings growth over the next few years be at least equal to nominal GDP, maybe a little bit higher.

~Bill Miller, chairman and CIO, Legg Mason Capital Management, CNBC's Squawk Box, April 6, 2011