10 Jun 2024

Stocks Look Cheap!

Since the beginning of 2023, the S&P 500 index has grown a staggering 40% through the end of May. While some of this performance has been driven by earnings growth, a lot of it has been good old-fashioned speculation as prices have outrun earnings. This is evident when looking at prices through the lens of company fundamentals. Consider the price-to-earnings (P/E) ratio. This ratio shows the value investors pay for… Read More

20 Jan 2016

Stock Prices are Lower. Are They Cheap?

Yesterday, Mike Lissner came over to my desk and asked what the Price Earnings-ratio (PE-ratio) was for the S&P 500.  I leaned over to my handy-dandy Bloomberg terminal, and looked it up and told him that it was 16.8. He then asked what the average was and moving to a different screen, I showed him that the average PE-ratio for the S&P 500 since 1954 was 16.4 and the median… Read More