Subject: Re: Market valuation
I think the TTM earnings per share for the SP500 is $281 ,

which would imply a PE of 6791 / 281 = 24

of course you picked the Shiller PE ratio - which looks to be at 39, here is a nice chart

https://www.multpl.com/shiller...


Why is the P/E on this site different than what is reported by S&P and other sites?

The P/Es listed on many other sites are based on earnings from the previous year only.

The figures on multpl.com are the PE10 or Shiller PE. They are the price to average earnings from the past ten years. Because this factors in earnings from the previous ten years, it is less prone to wild swings in any one year.


What is the P/E 10? How is it calculated?

To calculate P/E10:

Look at the yearly earning of the S&P 500 for each of the past ten years.
Adjust these earnings for inflation, using the CPI (ie: quote each earnings figure in 2025 dollars)
Average these values (ie: add them up and divide by ten), giving us e10.
Then take the current Price of the S&P 500 and divide by e10.





tecmo
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