For the last 3 years or so (barring April 2025 tariffs), we’ve been hearing the S&P 500 was way overvalued.
Now with a standard correction in the markets, perfect timing to Pam Bondi’s primal scream of Dow Jones at 50,000, we are sitting at 25.59 P/E ratio of the S&P 500, arguably the best 500 companies in the world! 🌎
Yes 25 could still be a bit high as compared to the 1980s, but it’s all about tech these days. Last year the lowest was 24 PE ratio (Trump).
Posted by ed2727
30 Comments
lol 25 P/E ratio. It’s a fire sale.
Until you realize the overhead rates that are going to skyrocket. Resource crunch is gonna keep pressing downward. Tired of winning yet?
spx went to 6-8 trailing p.e at generational bottoms. thats after the earnings collapsed, too.
pucker up youre gonna need to brace for impact.
Its so scary to do it but your right now is time to buy
I was tinking the same thing. S&P500 at 6400 is actually pretty decent, besides the war. I already have all my savings there. If I had more I would definitely buy now…
S and P might not be overvalued, but my Wendy’s salary is.
Was reading the only time in history the SPY had a higher valuation was the dot com bubble. And every time it traded at this valuation at a minimum a 20% drop followed in 6 months.
25 peratio is still overvalued.
You need under 20 for fair valuation.
Also your forward pe of 19 is for best expectations of earnings. It is without war, with low rates, and low oil prices.
Still very overvalued
Yeah but why not three years undervalued next?
how do you know if snp500 is overvalued or undervalued?
Is not high compare to late 90s during the internet bubble. Oh wait…
I got a bridge to sell you at a very reasonable price.
Corrections don’t stop because the price is right. They stop because people have got nothing left to fear. Which means we got a long way further to go.
You have no idea what you’re talking about.
It’s “not overvalued” purely because you’re comparing against earnings that are now outdated.
It’s like having a Restaurant that makes 100k a year being valued at 10M$, and being overvalued, one day that restaurant gets set on fire and burns to the ground, they put it on sale for 200k$ and you think it’s a great deal because you look at the P/L from the last quarters and say fuck me this is a gold mine at this price! Completely ignoring the fact that that pile of trash will net exactly zero from that day on.
It’s still gonna be overvalued when you look at the new earnings in a few months once they go down.
Careful here, the conclusion is slightly off.
S&P 500 at ~25–26x trailing P/E is **not “cheap” historically**
• long-term avg ~15–20x
• even 10-year avg ~23x
Forward P/E ~20–21x is lower, yes
but still **above historical norms**
This isn’t “undervalued”
It’s **less expensive than before**
I’ve been buying a share or two of VOO every day or two. Ride the wave, this will pass.
Or that’s what I’m telling myself.
This entire post is a recession indicator lol
Not that I’m a big technical analysis guy, but we just cut through the 200-day moving average like butter (after a bounce off it the other day). 30-40% of the energy infrastructure in the gulf is estimated to have been destroyed already, so even if the Strait opens tomorrow, we’re looking at a 6-8% oil and gas shortage for a few years – a massive energy shock. Buckle up buttercup.
Still overvalued. Not pricing in a massive oil spike
Still overvalued
Wait until we all subsidize SpaceX to the tune of billions! Yaaaaay for corruption!
*TSLA trailing P/E at 340*
It’s cheap I tell ya
Take 1000 points off SP500 current valuation then we are talking fair value.
Still hyper overvaluation territory.
Do what? Historical valuations trade at PE 15. We can drop another 30% and still be overvalued. There is just too much money supply. Wait for the fed to remove seven trillion from their balance sheet (then print another seven trillion and short the shit out of everything they touched over the last 15 years, fair and free market capitalism and all), then they have to raise interest rates exponentially to get the required deflation needed to get back in line with a historial 2% average. With the outstanding debt and derivatives the market will get below zero pretty fast. When we are trading under 0 you can say we are fairly valued.
It’s down 3% in 6 months and OP is already yelling “Stop the count!!” lmao
Retail panicking over small dips is so cute. We’re back to ATH next week when orange announces the actual “deal” so fund managers can force bear liquidations for quarter end mark up.
It’s not even at a 52 week low yet.
Wonder what this is going to feel like when interest rates get cut to zero this summer.
CAPE is 98% percentile right now
Tech doesn’t demand higher P/E when you consider they now require lots of capex.
It is when there’s a mango at the helm