"But the price-earnings ratio that I look at cyclically, the adjusted price-earnings ratio, is still overextended by any standard of the imagination."
|
|
What is CAPE, or the cyclically adjusted price-earnings ratio, exactly?
|
|
Evaluating the price-earnings ratio is a deeply ingrained practice for investors.
|
|
If you look at the price-earnings ratio of the S.&P.
|
|
Even based on the more common price-earnings ratio, the market looks rich.
|
|
And the cyclically-adjusted price-earnings ratio shows valuations are well above average.
|
|
O) and a fraction of the price-earnings ratio to Amazon Inc (AMZN.
|
|
Its price-earnings ratio hit a peak of 18.7 times earnings in late January.
|
|
Its average forward price-earnings-ratio has been 13 over the past two years.
|
|
Google, for example, has a price/earnings ratio of 30, while Facebook's is 84.
|
|
A more rational investor would use an unemotional measure, such as price-earnings ratio.
|
|
Both also have a price-earnings ratio at more than 35 times forward earnings.
|
|
Historically, the price-earnings ratio of emerging-market stocks — based on five years of averaged, or "normalized," profits — has been roughly 290 percent lower than the price-earnings ratio for stocks in the United States, according to figures compiled by the Leuthold Group.
|
|
He likes the stock's forward price-earnings ratio of six times, a relatively low multiple.
|
|
The S&P 33's price-earnings ratio is 17.5 times forward 12 months earnings.
|
|
The C.A.P.E. ratio is essentially the price earnings ratio, with annual fluctuations smoothed by averaging.
|
|
Oppenheimer said elevated operating risk along with the current price earnings ratio prompted its downgrade.
|
|
Essentially, investors can buy the S&P 500, a broad basket of companies with growing earnings and dividends, at a forward price earnings ratio of 15.1, or they can buy the risk free 85033 year Treasury note at an implied price earnings ratio of 36.3.
|
|
The stock is trading at a forward price-earnings ratio of 16, which Tepper finds reasonable.
|
|
In contrast, the S&P 500 now trades on an historic price-earnings ratio of 25.
|
|
Below, the share price in blue versus the trailing twelve month price/earnings ratio in orange.
|
|
Its price/earnings ratio is around 10 — on par with stodgy companies like Ford and Verizon.
|
|
The bank's price-earnings ratio will be 8.26 after the sale, according to a separate filing.
|
|
Centene has a forward price earnings ratio of 17, Anthem trades at 16 times estimated forward earnings.
|
|
FEW measures of stockmarket valuation are as controversial as the cyclically adjusted price-earnings ratio, or CAPE.
|
|
CHINEXTC boasts an average price earnings ratio of 65, compared with 21 for the Nasdaq 100 .NDX.
|
|
SSE50, another gauge that some liken to China's "Nifty 50", trades at price/earnings ratio under 10.
|
|
Stock prices are high: The cyclically-adjusted price-earnings ratio is at the third-highest since 1880.
|
|
We looked for the names whose forward price-earnings ratio is the farthest above their one-year average.
|
|
Bernstein's Toni Sacconaghi pointed to the stock's 17 times forward price-earnings ratio in a note to investors.
|
|
That's above the long-term average price/earnings ratio of 15, and that may be making investors skittish.
|
|
The metric that is most commonly used by investors to ascertain market valuation is the price earnings ratio.
|
|
The lower the price earnings ratio, with all else equal, the greater the margin of safety for investors.
|
|
The banks' multiple is well below the broader S&P 500's forward price/earnings ratio of 17.
|
|
With a current S&P 500 price-earnings ratio of 25, there is fairly significant room for correction.
|
|
The American firm's prospective price/earnings ratio, at around 67, is over twice that of its Chinese rival.
|
|
Kroger's price-earnings ratio has tumbled to 11.5 times future earnings, from 18.8 times in early 2016, Barron's said.
|
|
In a note to clients Thursday, Bernstein's Toni Sacconaghi pointed to the stock's 17 times forward price-earnings ratio.
|
|
The cyclically adjusted price-earnings ratio, as calculated by Robert Shiller of Yale, is double its long-term average.
|
|
Saudi Arabia's 12-month forward price-earnings ratio is 13.9 while the MSCI Emerging Market Index is at 13.
|
|
The forward price earnings ratio on the S&P 22019 is currently 15.1, compared to 25.3 a year ago.
|
|
The company, which is still listed on London's junior AIM market, has an eyewatering price-earnings ratio of 92.
|
|
Chinese stocks in the MSCI China Index as a whole have a 2018 forward price/earnings ratio of 12.7.
|
|
At the current forward price-earnings ratio of 18.2, according to Thomson Reuters proprietary research, the S&P 500 .
|
|
PEG is a stock's price-earnings ratio divided by the expected long-term growth rate in earnings per share.
|
|
On the Mumbai stock exchange its shares boast a price-earnings ratio of around 100, about the same as Amazon's.
|
|
A low price-earnings ratio is the stockmarket's way of telling you that business as you know it is over.
|
|
Leuthold Group's Doug Ramsey notes that the 's trailing price-earnings ratio is in the 90th percentile level since 1920.
|
|
The forward price-earnings ratio for the S&P 500 fell to 13.57 on Wednesday, the lowest since March 2013.
|
|
The PEG ratio is calculated by taking the price-earnings ratio divided by a company's estimated long-term growth rate.
|
|
Take those returns away and US equities would look reasonably priced under Robert Shiller's cyclically-adjusted price-earnings ratio methodology.
|
|
It trades at 110 times forward earnings, more than six times the price-earnings ratio on the S&P 500.
|
|
Its forward 12-month price-earnings ratio is 19.5 versus the S&P 500's 16.6, according to FactSet data.
|
|
Of the four, I would say that Lowe's is a dividend payer, and also has a lower [price-earnings ratio].
|
|
Analysts expect the price-earnings ratio in tech to drop, as some of the high-flying names like Alphabet leave.
|
|
P/E is shorthand for the price-earnings ratio, a metric used by investors to gauge the relative expensiveness of securities.
|
|
The forward price-earnings ratio for the S&P 500 fell to 14.62 on Friday, the lowest level since October 2014.
|
|
The cyclically adjusted price-earnings ratio (which averages profits over ten years) is 33.4, compared with the historical average of 16.8.
|
|
The trailing price/earnings ratio on the median stock is now 23.8, likewise the highest outside of the years 103-2000.
|
|
The Shanghai Composite index trades at a price earnings ratio of 13 times while Japan's Nikkei is at more than 20.
|
|
Typically, stock analysts think of valuations in terms of the price-earnings ratio, but it can be clarifying to invert it.
|
|
Charles Schwab Corp, for instance, has been trading at an average price/earnings ratio of 18 times, according to Refinitiv data.
|
|
The average price-earnings ratio for the S&P 500 is 18.1 at market tops, it's currently at 23.5 times earnings.
|
|
Qantas shares traded at a trailing price-earnings ratio of six, while regional rival Cathay Pacific traded at nine, Keenan said.
|
|
The forward price-earnings ratio for the S&P 500 is now 14.4, compared with 18.4 at the beginning of the year.
|
|
This year's losses pushed the EEM's price-earnings ratio — a widely followed valuation metric — down to 11.41, its lowest since February 2016.
|
|
The last time the S&P's price/earnings ratio dropped below 17.35, the index rallied nearly 20 percent in the next year.
|
|
The cyclically-adjusted price-earnings ratio (or CAPE), which averages profits over ten years, is 28.7, its highest level since April 2002.
|
|
The company's price-earnings ratio sits at around 170, and its annual cashflow is negative to the tune of billions of dollars.
|
|
It refers to the cyclically adjusted price-earnings ratio compiled by Robert Shiller of Yale University, which averages profits over ten years.
|
|
Apple, meanwhile, has a price-earnings ratio of just 10, which suggests that investors doubt its remarkable run of profits will last.
|
|
MIAP00000PUS had a forward price earnings ratio of 13.9, lower than the MSCI United States index's MIUS00000PUS 18.4 and MSCI Europe's 14.9.
|
|
The trailing 12-month price-earnings ratio has jumped to above 21 times from 16.7 in February of 2016, according to Oppenheimer.
|
|
Goldman's 12-month price target for Coca-Cola of $46 a share is based on a 20 times forward price-earnings ratio.
|
|
The Russell 1000 Growth index — which consists of a large number of technology companies — has a current price-earnings ratio of 19.7.
|
|
The investment management firm believes this simple method of using the price-earnings ratio is the best way to predict future returns.
|
|
The 3.63 price-earnings ratio for the iShares Select Dividend E.T.F. is about 20 percent higher than the long-term market norm.
|
|
Those who were uncertain when the market was trading at 14 times forward price/earnings ratio are now ecstatically euphoric at 18 times.
|
|
The cyclically adjusted price-earnings ratio, which averages profits over ten years, is just under 22017, according to Robert Shiller of Yale University.
|
|
The overall market is on a cyclically adjusted price-earnings ratio of 30—a level surpassed only in 1929 and the late 1990s.
|
|
The American stockmarket is on a cyclically adjusted price-earnings ratio of 30—a level surpassed only in 1929 and the late 1990s.
|
|
American equities are on a cyclically-adjusted price-earnings ratio of 31, according to the website of Robert Shiller, a previous Nobel winner.
|
|
He reckons S&P 21998 company valuations as measured by their price/earnings ratio will fall further as credit markets continue to deteriorate.
|
|
The cyclically adjusted price-earnings ratio is 31.42; it was last higher during the dot-com collapse that began in the late 1990s.
|
|
Along with the waggling diaper creature, you'd see the ticker symbol, stock price, one-year return — heck, maybe even the price-earnings ratio.
|
|
The stock had reached a trailing price-earnings ratio of about 7.6 times, according to Thomson Reuters data - cheap by emerging market standards.
|
|
He has long held Amazon shares, for example, even as other investors have said they are overvalued, based on the price-earnings ratio.
|
|
Measures of valuation like the cyclically adjusted price-earnings ratio show that stocks are as expensive as they were during the dotcom bubble.
|
|
The Nobel laureate says low volatility paired with a questionable price-earnings ratio could wipe out a chunk of the stock market's value.
|
|
The current price-earnings ratio is at 18.4 times, hitting a level the ratio hasn't seen since 2002, according to Bank of America.
|
|
Plus, the cyclically adjusted price-earnings ratio, created by Nobel Prize winner Robert Shiller, is near the highest since 2000 dot-com bubble.
|
|
He noted the S&P 500's fair value rested around 18 times next year's earnings, referring to the average's price-earnings ratio.
|
|
AMD trades at a price-earnings ratio of 42 times forward earnings, well above the 16.7 times multiple on the S&P 500.
|
|
One valuation approach, often referred to in this column, is the cyclically adjusted price-earnings ratio, or CAPE, which averages profits over ten years.
|
|
Very often, they hope that a benchmark of fair value, such as the cyclically-adjusted price-earnings ratio, or CAPE, will be their guide.
|
|
Ned Davis Research this week noted that the trailing price/earnings ratio on reported profits had reached the highest 20% of all historical readings.
|
|
The Shiller valuation level, whose formal name is the Cyclically Adjusted Price-Earnings Ratio, has captured considerable attention lately as the bull market continues.
|
|
For those who say the market is in a bubble, the current price earnings ratio is actually lower than the historical mean of 28503.
|
|
Siegel said a 20 price-earnings ratio is "the new normal," but he said political challenges for Republicans are going to weigh on markets.
|
|
He's also a big fan of Apple, which, he notes, when you strip out the cash is selling at a 15 price-earnings ratio.
|
|
They are very high, particularly when using the Cyclically Adjusted Price Earnings ratio, or C.A.P.E., which I defined almost thirty years ago with Prof.
|
|
This is because Apple would be paying a premium relative to its own price-earnings ratio, which sits below overall market averages, he noted.
|
|
That is based on the forward price-earnings ratio, which BofA says is now 17 times, still 11 percent above its long term average.
|
|
The cyclically-adjusted price-earnings ratio of the American market (which averages profits over 10 years) is 28.7, compared with a historic average of 16.7.
|
|
Tesla's price-earnings ratio, a measure of valuation, still trades as high as 121 times forward earnings even after the stock's steep decline this year.
|
|
In May 2007 the cyclically-adjusted price-earnings ratio (CAPE), a measure that averages profits over ten years, was 27.6 for American equities (see chart).
|
|
Only about 40 companies in the S&P 500 have a price-earnings ratio of less than 12, which is a sign of imminent decline.
|
|
He also looked at the difference between today's price/earnings ratio of about 24, and the historic P/E ratio to estimate the speculative return.
|
|
Yet an important stock market yardstick — the price-earnings ratio — suggests investors have an almost unquestioning faith in Netflix's ability to notch fast-growing earnings.
|
|
According to JP Morgan, the forward price/earnings ratio for the S&P 21 is 285, which is slightly expensive but well within historic norms.
|
|
The stock's forward price-earnings ratio has fallen to about 22 times, from a little more than 28 times at the beginning of this year.
|
|
The result is an average price-earnings ratio of around 13, well below the S&P 500's collective P/E which is now over 25.
|
|
The forward price-earnings ratio in '94 went from 15 down nearly to 12, compared with the trip from 18 to a bit over 15 now.
|
|
And with the market currently trading at a forward price-earnings ratio of about 17.4, "we're close to the top of that trading range," she said.
|
|
Specifically, its forward price-earnings ratio has come down from its mid-2016 peaks, and is now more in line with its recent average, she wrote.
|
|
One standard measure of richness is the price-earnings ratio — how much investors are willing to pay in terms of share price for $1 of earnings.
|
|
But even after that plunge, the stock was trading at a trailing price-earnings ratio of 30, about double the benchmark S&P/ASX 200 index.
|
|
They include the cyclically adjusted price-earnings ratio, which takes the price of the S&P 500 and divides it by ten years worth of earnings.
|
|
The XLY Consumer Discretionary ETF has a price-earnings ratio of 28 times forward earnings, slightly above the S&P 500's level of 17 times.
|
|
Stock market returns are a function of three factors: dividends, earnings growth and valuation adjustments, the latter being measured by the change in the price-earnings ratio.
|
|
The authors also use a valuation approach based on the relationship between the earnings yield (the inverse of the price-earnings ratio) and the real bond yield.
|
|
The forward price-earnings ratio for the S&P 500 is currently at 16.4 times, while the low rates are pointing to 20.4 times, the bank said.
|
|
Remove those unusual periods from the calculation and the average price-earnings ratio since 1990 becomes 5003, rather than the long-term 17 often used for comparison.
|
|
New Zealand, India and Australia stocks have the highest price-earnings ratio based on 12-month forward earnings in the region, according to Thomson Reuters Eikon data.
|
|
Though it has come off a bit from recent highs, the 's forward price-earnings ratio continues to be at very elevated levels within a historical context.
|
|
His Shiller PE Ratio, also known as CAPE, shows the price-earnings ratio based on average inflation-adjusted earnings from the last 10 years is over 30.
|
|
But with the market priced on a cyclically adjusted price-earnings ratio of 28.3, according to Robert Shiller of Yale, a lot of good news is priced in.
|
|
Markets are giving Dunstone some credit for this, with TalkTalk's forward price-earnings ratio rising from around 13 at the start of May to more than 15 now.
|
|
" Two possible triggers: "The S&P 500 is trading at 17.7 times 12-month forward estimated earnings, near the highest price/earnings ratio since the dot-com boom.
|
|
Are you willing to forego the potential for this sort of thing entirely because of a backward-looking price-earnings ratio that tells us nothing about the future?
|
|
The 28503-year Treasury bond is yielding less than 22019 percent, which means that it is essentially selling at a price earnings ratio of nearly 35 times earnings.
|
|
Now, I would argue that bonds are still relatively expensive compared to stocks, as the current price-earnings ratio on the S&P 500 index is near 26.
|
|
The S&P 500's forward price-earnings ratio just hit its highest level in 13½ years, according to a new report from Bank of America Merrill Lynch.
|
|
In the meantime, equities trade on a cyclically adjusted price-earnings ratio (which averages profits over the past ten years) of 27.3, according to Robert Shiller of Yale University.
|
|
At recent levels in excess of 30, the U.S. stock market's cyclically adjusted price/earnings ratio (CAPE), for example, has exceeded its post-1982 average by almost 25 percent.
|
|
Indeed, the price-earnings ratio of General Motors is trading at a mere seven times forward earnings, far below that of the overall market, while Tesla consistently loses money.
|
|
Indeed, the forward price-earnings ratio of the S&P 500 for the next 12 months is hovering near its highest level since early 2004, according to FactSet data.
|
|
Since 1958, the average price/earnings ratio for stocks when the inflation rate has been 2 to 19703 percent has been 17.6, according to an analysis by Charles Schwab.
|
|
It trades at a forward price/earnings ratio of 21, compared to 2600 at Salesforce, an all-cloud outfit, 23.6 at Microsoft and 212 at Oracle, according to Refinitiv data.
|
|
Correspondingly, opposite characteristics - a high ratio of price to book value, a high price-earnings ratio, and a low dividend yield - are in no way inconsistent with a 'value' purchase.
|
|
Among the most conservative – some would say punitive – methods, is Robert Shiller's Cyclically Adjusted Price/Earnings ratio, based on the past 10 years' reported earnings for the S&P 500.
|
|
And it seems to be no coincidence that the highest price-earnings ratio since 1881 (I calculate this ratio with 10-year-average earnings in the denominator) occurred around then.
|
|
It trades at a forward price/earnings ratio of 2200, compared to 43 at Salesforce, an all-cloud outfit, 24 at Microsoft and 25 at Oracle, according to Refinitiv data.
|
|
But with the cyclically adjusted price-earnings ratio on the American stockmarket around twice its long-term average, equities are vulnerable to any kind of bad news. Economist.com/blogs/buttonwood
|
|
The cyclically adjusted price-earnings ratio (CAPE), as calculated by Robert Shiller of Yale University, averages profits over ten years and is used by many as an important valuation indicator.
|
|
"These strengths seem to us to be now properly reflected in its premium valuation at 34 times estimated 2018 P/E (price-earnings ratio), on our current numbers," they said.
|
|
Or is it something in between?" he asked, though he did not provide an answer beyond saying that measuring the market by its price-earnings ratio shows it's "relatively expensive.
|
|
Apple trades for just a 19 price-earnings ratio based on estimated 12-month earnings, lower than the P-E on the S&P 500 of more than 22 times.
|
|
The price-earnings ratio, a measure of valuation, for the TSX is 14.2, according to Refinitiv Eikon data, much less than the 18.6 price multiple for the S&P 500.
|
|
If investors expect it to make $10 per share (its net income divided by the number of shares it has issued), it would have a price-earnings ratio of 10.
|
|
At Thursday's lows the S&P 500 forward price/earnings ratio dropped to 14, near where it bottomed in late 2018, but current profit forecasts are likely laughably too high.
|
|
Apple is valued at just 275 times analysts' earnings estimates for its next 12 months, compared with a forward price-earnings ratio of 16.5 times for the S&P 500.
|
|
On a fundamental basis, Stovall points to the rule of 20, which measures the price/earnings ratio with inflation, put the stock market as overvalued by at least 13 percent.
|
|
It may look disturbing that America's cyclically adjusted price-earnings ratio has spent most of the past two years above 30, a level that was last breached during the dotcom boom.
|
|
That was especially so since American shares are trading on a cyclically adjusted price-earnings ratio of 29, a level exceeded only in the booms of the late 1920s and 1990s.
|
|
By averaging the yield over ten years, they work out the cyclically-adjusted total yield (CATY) and compare it with the cyclically-adjusted price-earnings ratio (CAPE), which averages corporate profits.
|
|
For most investors, that's a negative, but to the value-conscious Buffett and his team, it's probably an opportunity: Apple shares now trade at a price-earnings ratio of just 10.
|
|
The company currently has a multiple of 41 times earnings, compared rival Nike, which is actually up 16 percent this year and currently has a forward price-earnings ratio of 25.
|
|
Using a price/earnings ratio derived from a 10-year average of earnings, stocks are now more expensive than they have been 92 percent of the time over more than a century.
|
|
Indeed, the S&P 500's forward price-earnings ratio is about 17.5, which is above historical norms, and a bit higher than the last time the index was at this level.
|
|
Emaar had reached a level where it became a buying opportunity, said Marie Salem, director of Capital Markets at FFA Dubai; its trailing price-earnings ratio had sunk to about 20.5 times.
|
|
Take Nvidia for example – its shares have surged 20 percent since the beginning of the year, quadruple gains by the S&P, putting its price-earnings ratio at 50 times forward earnings.
|
|
But it's earnings, where investors will take the pulse of corporate America, and decide whether forward guidance is justifying the stock market's record highs and price earnings ratio of more than 93.
|
|
The CSI 300, an index of China's biggest firms, has a 14-times price-earnings ratio, comparing favourably with the 25-times ratio of the S&P 500, America's most-watched share index.
|
|
Even after a 33 percent surge to about $800 billion in market value this year, Apple's shares appear cheap going by the most widely used method to value stocks: the price-earnings ratio.
|
|
China and Japan's forward 12-month price/earnings ratio stand at 8.43 and 12.97 respectively, compared to 15.8 for the U.S. and 14.68 for Britain, according to data from asset management firm LGT.
|
|
Valuations/expected return The forward-looking price-earnings ratio for global equities is currently tipping the scales at 18%, with major indices notching gains upwards of 16% in the first half of 2019.
|
|
They cite the fact that the S&P 28500 index is selling at a price earnings ratio of 6900 times, compared to an historical mean of 2628 times, trailing over the past year.
|
|
Even at a price-earnings ratio near 20 for growth stocks, history shows returns 10 years later were in the high single digits, on average, according to the report by Fred Alger Management.
|
|
The S&P 2600 price/earnings ratio is currently 215.8 compared with its long-term average of 223, while the Russell 216 forward P/E is 5003 compared with its 2500 historical average.
|
|
For example, Apple is trading at a little higher than 18 times trailing earnings, while Facebook carries a price-earnings ratio of 27 times, Amazon at 144 times and Netflix at 162 times.
|
|
Emerging markets have risen much faster than the S&P 500 this year, gaining 12%, and trade on an historic price-earnings ratio of less than 14, according to Société Générale, a French bank.
|
|
With Japan's fiscal year-end looming, the Government Pension Investment Fund and other funds were likely buyers as the Nikkei has become cheap, with its price/earnings ratio falling to around 12, traders said.
|
|
The S&P 500 is trading on an historic price-earnings ratio, relative to last year's profits, of 21; it has spent the vast bulk of the last 90 years trading below that level.
|
|
As a measure of animal spirits, Robert Shiller, a Nobel prize-winning economist, adjusts the S&P 500's price-earnings ratio by comparing the current price to the 10-year average of earnings.
|
|
U.S. stocks still appear to be expensive, with the forward price earnings ratio of the S&P 500 at 16.4, below the 17.4 reached in March but still at highs not seen since 19453.
|
|
Even this $390 target, however, entails expectations of a price-earnings ratio of 40, which just goes to show how much optimism investors are still managing to have about the company at this point.
|
|
In the same vein, David Lafferty, senior vice president at Natixis Global Asset Management, told CNBC that the market is seeing values it hasn't viewed since 2013, in terms of the price-earnings ratio.
|
|
At FedEx's current price/earnings ratio of 14.3, the company's shares aren't just trading below the market average, they are at a 47 percent discount to the company's five-year average, according to Morningstar.
|
|
While stock market valuations in commodity-producing emerging markets are dirt cheap — Russian stocks, for instance, trade at a price-earnings ratio of around 6 — commodity importers like South Korea and India are more expensive.
|
|
After the strong gains, only three Dow components have a forward 12-month price-earnings ratio below their five-year average forward multiple, a simple analysis often used by value investors to spot cheap companies.
|
|
If this cyclically-adjusted price-earnings ratio (CAPE) is higher than its long-run mark, that suggests that either prices must fall or earnings must rise for the index's valuation to return to normal levels.
|
|
The S&P 753 forward price-earnings ratio for this year fell to 15.8 as of Monday, in line with the historic average and down from 19.3 less than a month ago, according to Refinitiv.
|
|
Yet 2018 share gains are expected to be smaller than 2017 with the S&P 500's price/earnings ratio - a measure of stock prices against expected profits - is around its highest level since June 2002.
|
|
Robeco, a Dutch fund-management group, reckons that emerging markets trade at a 30% discount to rich-world equities, in terms of their prospective price-earnings ratio (the next year's profits, relative to the share price).
|
|
Apple's stock recently traded at 14.3 times expected earnings, the highest level since April 2015 and significantly higher than the average price-earnings ratio of 12 over the past five years, according to Thomson Reuters Datastream.
|
|
In an email, Osborne explained that "we typically discount as part of the P/E," implying that he actually expects the price-earnings ratio to be significantly higher than the stated 22 to 24 times range.
|
|
For additional context, Dwyer referenced historical trends in the market dating back to the 1970's, when inflation was at 14 percent and the S&P 500 operating earnings price/earnings ratio (P/E) was at 8.
|
|
Italy to vote on March 4, with hung parliament feared Italian bond yields hit 2-mth high, stocks slide as election confirmed To view a graphic on Italian stocks price earnings ratio, click on this link: reut.
|
|
The CAPE ratio (cyclically adjusted price-earnings ratio), a widely followed measure designed by Yale economist Robert Shiller that compares stock prices to corporate earnings, is currently at about 32, or double its historical median of 16.
|
|
Growth investors have been winning the battle over value investors for some time, but a new report from Bank of America-Merrill Lynch shows that evaluating a company's price-earnings ratio may be losing its value altogether.
|
|
The stock is at trailing 26-month price/earnings ratio of 2823 times, according to Thomson Reuters data, cheaper than some other major developers such as Talaat Mostafa at 21 times and Amer Group at 0.23 times.
|
|
Barclays analysts this month valued the company at $155 billion, based on multiplying their estimate of Ant's 2019 net operating profit less adjusted tax (NOPLAT) by what they said was its conservative price/earnings ratio of 28.
|
|
This is true, although of course, bond yields have been at historical lows for some time, and the cyclically adjusted price-earnings ratio of US equities (currently 27) has been well above the historic average since 2009.
|
|
"The market trades on a 12-month forward price-earnings ratio of 14.8 times, at the upper end of the 15-year range, at a time when we expect earnings to contract 1% in 2020," he said.
|
|
Now, some strategists say the stock is simply too rich at current levels to buy in, with a price-earnings ratio of a little over 30 times forward earnings — and the technicals are equally bleak to some.
|
|
At the start of 1985 American shares traded on a cyclically adjusted price-earnings ratio (a figure which averages profits over ten years) of ten; now the ratio is over 31, according to Robert Shiller of Yale University.
|
|
Bristol-Myers shares trade at about 23 times the company's expected 2017 per-share earnings, well above the approximate price-earnings ratio of 16 for its large rivals, based on optimism for widening use of Opdivo and Yervoy.
|
|
Over the last five years, the price/earnings ratio on the Russell 3000 index has expanded from 15.2 to 21.9, while the multiple in the REIT market (based on funds from operations) has fallen from 18.9 to 16.4.
|
|
" Meanwhile, biotech valuations "are just starting to recover," she wrote to CNBC on Friday, while the forward price-earnings ratio for the S&P 500 as a whole "has remained at the top of a 3 year range.
|
|
The forward price/earnings ratio of the S&P 500 now exceeds 19, the high for this bull market, while the expected rebound in profit growth keeps getting pushed ahead into the future by the global industrial slowdown.
|
|
The cyclically adjusted price-earnings ratio of the American market, which uses a ten-year average of profits, is 32.4; it has been higher only in September 3.33 (just before the Wall Street crash) and during the dotcom bubble.
|
|
Blackrock, the world's largest asset manager, is among those who argue that stock market valuation metrics such as the Shiller price/earnings ratio are no longer valid, and that the bull run can continue for several more years yet.
|
|
SPX is just 1.7 percent below its all-time closing high and is selling at roughly 16.8 times the expected earnings of its components over the next 12 months, above its 15-year average price earnings ratio of 15.
|
|
The forward price-earnings ratio, a common measure of market valuations that compares the index's to analysts' consensus expectation for earnings over the next year, is now at the highest level since 2004, according to information from S&P Global.
|
|
Over the past 20073 years the cyclically adjusted price-earnings ratio (CAPE), a useful measure of how expensive stocks have become, has reached its current heights only twice before: during the dotcom bubble; and just before the Crash of '29.
|
|
Here is FactSet's chart of the forward 12-month price/earnings ratio: The valuation peak 13 months ago above 23 times was when the market was rushing to price in the tax-cut windfall not yet reflected in analysts' estimates.
|
|
Compared to the 220 price earnings ratio for the S&P 500 of 17.5 today, the average staple stock trades at 22 times with the average consumer discretionary priced at a turn of 23 on this year's earnings per share.
|
|
He sees India as the region's most expensive market - with some consumer goods companies trading at a price-earnings ratio of 30 - though he's charmed by the country's non-state banks, which have been neglected since they underwent a bad credit cycle.
|
|
But despite a price/earnings ratio that lags smaller, more specialised peers like poultry processor Fujian Sunner or the pig producer Muyuan Foods, Wen's was big enough to ride out prolonged losses from its pig business, said Chen Lu, analyst at Zhongtai Securities.
|
|
Indeed, the forward price/earnings ratio of the Shanghai index, based on earnings expectations for 223, is around 222.1, the lowest level since panic selling in early 212 when the market was still dealing with the hangover from the 2015 financial crisis.
|
|
Across emerging markets, equities are valued at a 45 percent discount to U.S. equities based on their 10-year cyclically-adjusted price-earnings ratio — not far from the record during the technology boom in late-1990s, the bank said in its review.
|
|
The better-than-expected earnings have helped keep traditional valuation measures in check, with the five largest stocks trading at a price-earnings ratio of 30 times, better than the 47 times they topped before the tech bubble burst two decades ago.
|
|
Mark Tepper, CEO of Strategic Wealth Partners, told "Trading Nation" that he finds its price-earnings to growth ratio, or PEG ratio — a measure of a stock's value by taking its price-earnings ratio and factoring in its earnings growth rate — reasonable at this juncture.
|
|
S&P Global Market Intelligence provided data which show that the current price-earnings ratio on trailing GAAP earnings per share is at 25.3 times, second only to the trailing P/E which peaked at 31.7 times during the overheated bull market of 2000.
|
|
Stocks aren't observably cheap, the S&P forward price/earnings ratio is above 22016, but with the S&P 500 dividend yield now equal to a 10-year Treasury note yield and corporate yields not much higher, how much cheaper would one expect stocks to be?
|
|
"Valuations for Canada appear attractive compared to the U.S." The Toronto market trades at a multiple of less than 15 times annualized earnings, based on a preceding 12-month period, versus a price-earnings ratio of about 22 for the S&P 500, data from Refinitiv Eikon showed.
|
|
If Tesla shares were to grow 10 percent a year for the next 10 years - not unreasonable for a popular growth company - it would have to reach annual sales of 1.5 million cars at triple GM's typical $1,000-per-car profit to justify a more moderate price-earnings ratio of 20.
|
|
"They're in a high-growth area, they've got a [price/earnings-to-growth] ratio of 0.5, so you're basically paying next to nothing for that growth at this price," he said, referring to a metric used to value a company by its price-earnings ratio and its expected earnings growth.
|
|
"As far as the market itself is concerned, the valuation may be on the high end, but people seem to ignore the fact that when you look at the price-earnings ratio to the inflation rate, which is running at about 2 percent, it doesn't seem that unreasonable relative to history," he said.
|
|
The FTSE 100 index yields 4.6% and trades on a historic price-earnings ratio of 11.5, making it look quite cheap by past standards; it is also trading at around the same level as it was at the end of the last century, suggesting a lot of bad news is priced into the market.
|
|
" Buffett added that a low ratio of price to book value, a low price- earnings ratio, or a high dividend yield, "even if they appear in combination, are far from determinative as to whether an investor is indeed buying something for what it is worth and is therefore truly operating on the principle of obtaining value in his investments.
|
|
But YTD the three indexes are up 270 percent, 33.17 percent and 21.38 percent — with most commentators putting the outperformance outside the United States to a long-awaited broad global recovery or to capital that is looking for bargains, as the price/earnings ratio of the stocks in the S&P 500 has risen to more than 24.
|
|
"If you look at the previous bull market that we're looking to eclipse, the one that happened in the 1990s, the PE [price/earnings] ratio at that point got into the mid-20s, so I think we have a long way to go from here in terms of valuation if this rally really has legs," the investor added.
|
|
That's because the correlation between the S&P 500's price-earnings ratio and the Fed funds rate has broken due to the long period of low rates since the early 2000s, UBS noted "Fed rate cuts are not likely to fuel equities higher as they did in the 1990s," UBS equity strategist Francois Trahan said in a note on Tuesday.
|
|
Looking at classic metrics like price-to-book ratios, and trailing and forward price-earnings ratios, Keon said that emerging market equities present a better value at these levels than those in the U.S. One large emerging markets exchange-traded fund, the EEM, carries a forward price-earnings ratio of 12.4; that compares to 16.5 on the S&P 500 Index.
|
|
What's clear is that the recent rally has come largely on the back of rising valuations; the S&P's forward price-earnings ratio has risen from 210 just before the election to 18.1 as of Friday's close, according to data from S&P Capital IQ. The current earnings multiple is just a touch below the 13-year high of 18.4 it set at the beginning of March.
|
|
AND SINCE WHAT THAT ULTIMATELY DETERMINES OR WHETHER OR NOT YOU'RE GETTING AN EFFECT FROM THE QEs – WHAT HAS HAPPENED TO THE PRICE EARNINGS RATIO AND THAT OBVIOUSLY HAS DONE WHAT YOU WOULD EXPECT IT TO DO. YOU BRING LONG-TERM RATES DOWN AND PRICE EARNINGS RATIOS IN THE EQUITY MARKETS GO UP, WHICH IS EXACTLY WHAT THEY PLANNED TO DO AND IT HAPPENED THAT WAY.
|
|
They've been stretched for a while, but now we're getting not just [price-earnings ratio], but price-to-sales, market cap to GDP, all combined at levels that are usually followed by a period of underperformance or poor performance in the stock market for three to five years, or even longer," Matt Maley, equity strategist at Miller Tabak, said Friday on CNBC's "Trading Nation.
|
|
Add to that the technological revolution taking place where up to 2 billion inefficient internal combustion engines need to be replaced over the next decade and things should be tickety-boo And yet take a look at the valuations on a price/earnings ratio for the sector, which is currently around seven times forward PE, and car manufacturers are giving the other two sectors a run for their money in the ugly stakes.
|
|