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The U.S. Equity Market Appears Overvalued


By just about any fundamental measure, the U.S. equity market appears overvalued, analysts say.  Five traditional measures of stock market valuation--the cyclically-adjusted P/E ratio (or CAPE), made famous by Nobel  prize –winning Yale professor Robert Shiller; the price-to-book ratio, price-to-sales ratio and the dividend yield all saw a vast majority of past bull markets peak  at lower valuations than April’s readings.  In other words, in April the market was more overvalued than it was at the peaks of 86% to 100% of all past bull markets. (Chart: Mark Hulbert, marketwatch.com)


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