Valuation – P/E Ratio Spread Between Russell 1000 Growth and Russell 1000 Value The P/E valuation spread for Growth vs. Value at 12.88 is nowhere near the 46.47 level seen at the 2000 peak and suggests that Growth should continue to beat value. Image: BofA Global Research
S&P 500 Forward 2-Year P/E Ratio The U.S. stock market is pricing in a V-shaped economic recovery. Image: Goldman Sachs Global Investment Research
Valuation – S&P 500 12-Month Forward P/E Ratio The 12m forward P/E ratio of the S&P 500, close to 19x, remains at high level and above its historical range. Image: The Daily Shot – The Wall Street Journal
Valuation – S&P 500 Forward P/E Ratio Chart showing that the forward P/E ratio of the S&P 500 remains at high level, above its historical range. Image: Fidelity Investments
Core Inflation and Average Trailing S&P 500 P/E Ratio In periods of low inflation, the P/E ratio is higher. Conversely, high inflation tends to depress the P/E ratio. Image: Goldman Sachs Global Investment Research
S&P 500 Forward P/E Ratio S&P 500 to 3,550? “Bull markets don’t die of old age” but the forward P/E ratio of the S&P 500 remains at high level. Image: SunTrust Private Wealth Management
Valuation – Forward P/E Ratio From the valuation peak of January 2018, most P/E ratios have seen drawdowns of 20%-30%, making this feel like a bear market. Image: Fidelity Investments
Strong vs. Weak Balance Sheet Stocks Forward P/E Ratio and CCC/BB OAS Ratio Quality in U.S. credit and equity markets is very expensive. Image: Goldman Sachs Global Investment Research
U.S. Yield Curve and Growth/Value P/E Ratio The chart below shows that the shape of yield curve explains nearly 50% of the variation in value vs. growth multiples. Actually, when the U.S. economy is sluggish, investors prefer growth stocks. Image: BlackRock, Inc.
S&P 500 Valuation – Forward P/E Ratio – May 10, 2019 S&P 500 Valuation: Forward P/E Ratio is 16.5 and equal to the 5-year average, above the 10-Year average (14.7).Based on the forward P/E ratio, the US stock market is not too expensive. You may also like our “Stock Market Valuation.” Image: FactSet Research Systems Inc.