S&P 500 Price to Peak Earnings

Written by:
PK

On this page you'll find the S&P 500's price to peak earnings ratio, including its maximum, minimum, average, and median since 1871. You can choose to adjust for inflation (CPI), or use the nominal peak earnings.

Additionally, find a visualization tool plus a table with the historical price to peak earnings ratio.

S&P 500 Price to Peak Earnings History Tool

Historical S&P 500 Price to Peak Earnings Ratio

Below is the monthly history of the S&P 500 Price to Peak Earnings Ratio.

For recent months without earnings data, it reuses the last known earnings to compute the peak – expect the most recent months to change when you come back and visit us again. Well – assuming the most recent months are the highest inflation adjusted earnings the index has experienced, anyway!

Historical S&P 500 Price to Peak Earnings Ratio by Month

Earnings are the trailing 12 month (TTM) earnings, based on the highest ever 12 month reading.

MonthIndex AveragePeak Earnings/SharePrice/Peak EarningsCPI Peak Earnings/ShareCPI PPE
01-18714.440000$0.4011.1$0.4011.1
02-18714.500000$0.4011.25$0.4110.92
03-18714.610000$0.4011.53$0.4211.02
04-18714.740000$0.4011.85$0.4011.76
05-18714.860000$0.4012.15$0.4012.15
06-18714.820000$0.4012.05$0.4012.05
07-18714.730000$0.4011.83$0.4011.83
08-18714.790000$0.4011.98$0.4011.98
09-18714.840000$0.4012.1$0.4111.81
10-18714.590000$0.4011.48$0.4211.03
11-18714.640000$0.4011.6$0.4211.15
12-18714.740000$0.4011.85$0.4311.14
01-18724.860000$0.4012.07$0.4311.42
02-18724.880000$0.4112.05$0.4311.47
03-18725.040000$0.4112.37$0.4311.67
04-18725.180000$0.4112.63$0.4411.73
05-18725.180000$0.4112.56$0.4411.73
06-18725.130000$0.4212.36$0.4411.7
07-18725.100000$0.4212.22$0.4311.81
08-18725.040000$0.4212$0.4411.58
09-18724.950000$0.4211.72$0.4411.29
10-18724.970000$0.4311.69$0.4311.59
11-18724.950000$0.4311.58$0.4411.21
12-18725.070000$0.4311.79$0.4411.65
01-18735.110000$0.4311.82$0.4411.74
02-18735.150000$0.4411.84$0.4511.57
03-18735.110000$0.4411.68$0.4511.48
04-18735.040000$0.4411.45$0.4511.32
05-18735.050000$0.4411.41$0.4411.41
06-18734.980000$0.4511.19$0.4511.19
07-18734.970000$0.4511.11$0.4511.11
08-18734.970000$0.4511.04$0.4511.04
09-18734.590000$0.4510.14$0.4510.14
10-18734.190000$0.469.21$0.469.21
11-18734.040000$0.468.83$0.468.83
12-18734.420000$0.469.61$0.479.43
01-18744.660000$0.4610.13$0.489.79
02-18744.800000$0.4610.43$0.4810.08
03-18744.730000$0.4610.28$0.489.94
04-18744.600000$0.4610$0.479.82
05-18744.480000$0.469.74$0.469.64
06-18744.460000$0.469.7$0.469.7
07-18744.460000$0.469.7$0.469.62
08-18744.470000$0.469.72$0.469.72
09-18744.540000$0.469.87$0.469.87
10-18744.530000$0.469.85$0.469.85
11-18744.570000$0.469.93$0.469.93
12-18744.540000$0.469.87$0.469.87
01-18754.540000$0.469.87$0.469.87
02-18754.530000$0.469.85$0.469.85
03-18754.590000$0.469.98$0.469.98
04-18754.650000$0.4610.11$0.4610.02
05-18754.470000$0.469.72$0.459.88
06-18754.380000$0.469.52$0.449.85
07-18754.390000$0.469.54$0.449.87
08-18754.410000$0.469.59$0.459.83
09-18754.370000$0.469.5$0.449.82
10-18754.300000$0.469.35$0.449.67
11-18754.370000$0.469.5$0.449.9
12-18754.370000$0.469.5$0.449.99
01-18764.460000$0.469.7$0.4310.29
02-18764.520000$0.469.83$0.4310.42
03-18764.510000$0.469.8$0.4310.4
04-18764.340000$0.469.43$0.4310.1
05-18764.180000$0.469.09$0.4110.09
06-18764.150000$0.469.02$0.4010.29
07-18764.100000$0.468.91$0.4010.17
08-18763.930000$0.468.54$0.419.66
09-18763.690000$0.468.02$0.418.98
10-18763.670000$0.467.98$0.428.77
11-18763.600000$0.467.83$0.428.53
12-18763.580000$0.467.78$0.438.33
01-18773.550000$0.467.72$0.448.12
02-18773.340000$0.467.26$0.437.84
03-18773.170000$0.466.89$0.417.79
04-18772.940000$0.466.39$0.427.03
05-18772.940000$0.466.39$0.436.9
06-18772.730000$0.465.93$0.406.77
07-18772.850000$0.466.2$0.417.01
08-18773.050000$0.466.63$0.397.79
09-18773.240000$0.467.04$0.398.36
10-18773.310000$0.467.2$0.398.54
11-18773.260000$0.467.09$0.388.58
12-18773.250000$0.467.07$0.388.55
01-18783.250000$0.467.07$0.378.81
02-18783.180000$0.466.91$0.368.72
03-18783.240000$0.467.04$0.369.07
04-18783.330000$0.467.24$0.359.41
05-18783.340000$0.467.26$0.349.76
06-18783.410000$0.467.41$0.3310.19
07-18783.480000$0.467.57$0.3410.28
08-18783.450000$0.467.5$0.3410.08
09-18783.520000$0.467.65$0.3410.29
10-18783.480000$0.467.57$0.3410.28
11-18783.470000$0.467.54$0.3310.37
12-18783.450000$0.467.5$0.3310.55
01-18793.580000$0.467.78$0.3310.82
02-18793.710000$0.468.07$0.3311.09
03-18793.650000$0.467.93$0.3311.03
04-18793.770000$0.468.2$0.3311.31
05-18793.940000$0.468.57$0.3411.62
06-18793.960000$0.468.61$0.3511.48
07-18794.040000$0.468.78$0.3511.52
08-18794.070000$0.468.85$0.3611.41
09-18794.220000$0.469.17$0.3711.43
10-18794.680000$0.4610.17$0.3912
11-18794.930000$0.4610.72$0.4112
12-18794.920000$0.4610.7$0.4211.63
01-18805.110000$0.4611.11$0.4411.73
02-18805.200000$0.4611.3$0.4411.94
03-18805.300000$0.4611.52$0.4412.05
04-18805.180000$0.4611.26$0.4212.25
05-18804.770000$0.4610.37$0.4311.2
06-18804.790000$0.4610.41$0.4411.01
07-18805.010000$0.4610.89$0.4411.28
08-18805.190000$0.4611.28$0.4511.45
09-18805.180000$0.4611.2$0.4611.2
10-18805.330000$0.4711.3$0.4711.3
11-18805.610000$0.4811.67$0.4811.67
12-18805.840000$0.4911.92$0.4911.92
01-18816.190000$0.4912.63$0.4912.74
02-18816.170000$0.4912.59$0.4912.58
03-18816.240000$0.4912.73$0.4912.72
04-18816.220000$0.4912.69$0.5012.55
05-18816.500000$0.4913.27$0.4913.25
06-18816.580000$0.4913.43$0.4913.42
07-18816.350000$0.4912.96$0.5012.81
08-18816.200000$0.4912.65$0.5112.27
09-18816.250000$0.4912.76$0.5211.9
10-18816.150000$0.4912.55$0.5311.6
11-18816.190000$0.4912.63$0.5211.79
12-18816.010000$0.4912.27$0.5211.45
01-18825.920000$0.4912.08$0.5211.28
02-18825.790000$0.4911.82$0.5310.92
03-18825.780000$0.4911.8$0.5310.9
04-18825.780000$0.4911.8$0.5310.81
05-18825.710000$0.4911.65$0.5410.58
06-18825.680000$0.4911.59$0.5410.43
07-18826.000000$0.4912.24$0.5411.11
08-18826.180000$0.4912.61$0.5411.35
09-18826.240000$0.4912.73$0.5311.77
10-18826.070000$0.4912.39$0.5211.56
11-18825.810000$0.4911.86$0.5211.17
12-18825.840000$0.4911.92$0.5211.34
01-18835.810000$0.4911.86$0.5211.28
02-18835.680000$0.4911.59$0.5210.92
03-18835.750000$0.4911.73$0.5211.16
04-18835.870000$0.4911.98$0.5111.5
05-18835.770000$0.4911.78$0.5111.42
06-18835.820000$0.4911.88$0.4911.87
07-18835.730000$0.4911.69$0.4811.92
08-18835.470000$0.4911.16$0.4811.38
09-18835.530000$0.4911.29$0.4811.62
10-18835.380000$0.4910.98$0.4811.3
11-18835.460000$0.4911.14$0.4711.6
12-18835.340000$0.4910.9$0.4811.22
01-18845.180000$0.4910.57$0.4810.88
02-18845.320000$0.4910.86$0.4811.18
03-18845.300000$0.4910.82$0.4811.13
04-18845.060000$0.4910.33$0.4710.85
05-18844.650000$0.499.49$0.4610.19
06-18844.460000$0.499.1$0.469.77
07-18844.460000$0.499.1$0.459.88
08-18844.740000$0.499.67$0.4510.5
09-18844.590000$0.499.37$0.4510.28
10-18844.440000$0.499.06$0.4410.06
11-18844.350000$0.498.88$0.4310.08
12-18844.340000$0.498.86$0.4310.16
01-18854.240000$0.498.65$0.439.93
02-18854.370000$0.498.92$0.4310.12
03-18854.380000$0.498.94$0.4210.38
04-18854.370000$0.498.92$0.4310.23
05-18854.320000$0.498.82$0.4210.35
06-18854.300000$0.498.78$0.4110.55
07-18854.460000$0.499.1$0.4110.82
08-18854.710000$0.499.61$0.4111.43
09-18854.650000$0.499.49$0.4111.41
10-18854.920000$0.4910.04$0.4112.08
11-18855.240000$0.4910.69$0.4112.72
12-18855.200000$0.4910.61$0.4212.33
01-18865.200000$0.4910.61$0.4112.62
02-18865.300000$0.4910.82$0.4112.86
03-18865.190000$0.4910.59$0.4112.74
04-18865.120000$0.4910.45$0.4012.73
05-18865.020000$0.4910.24$0.3912.79
06-18865.250000$0.4910.71$0.3913.54
07-18865.330000$0.4910.88$0.3913.58
08-18865.370000$0.4910.96$0.4013.51
09-18865.510000$0.4911.24$0.4013.86
10-18865.650000$0.4911.53$0.4014.21
11-18865.790000$0.4911.82$0.4014.56
12-18865.640000$0.4911.51$0.4014.02
01-18875.580000$0.4911.39$0.4113.54
02-18875.540000$0.4911.31$0.4213.28
03-18875.670000$0.4911.57$0.4213.59
04-18875.800000$0.4911.84$0.4213.9
05-18875.900000$0.4912.04$0.4214.14
06-18875.730000$0.4911.69$0.4113.91
07-18875.590000$0.4911.41$0.4113.72
08-18875.450000$0.4911.12$0.4113.23
09-18875.380000$0.4910.98$0.4113.21
10-18875.200000$0.4910.61$0.4112.62
11-18875.300000$0.4910.82$0.4212.7
12-18875.270000$0.4910.76$0.4312.34
01-18885.310000$0.4910.84$0.4312.3
02-18885.280000$0.4910.78$0.4312.37
03-18885.080000$0.4910.37$0.4311.9
04-18885.100000$0.4910.41$0.4212.09
05-18885.170000$0.4910.55$0.4212.39
06-18885.010000$0.4910.22$0.4112.16
07-18885.140000$0.4910.49$0.4212.32
08-18885.250000$0.4910.71$0.4212.58
09-18885.380000$0.4910.98$0.4212.9
10-18885.350000$0.4910.92$0.4212.68
11-18885.240000$0.4910.69$0.4312.27
12-18885.140000$0.4910.49$0.4312.04
01-18895.240000$0.4910.69$0.4112.72
02-18895.300000$0.4910.82$0.4113.01
03-18895.190000$0.4910.59$0.4012.9
04-18895.180000$0.4910.57$0.4012.88
05-18895.320000$0.4910.86$0.3913.56
06-18895.410000$0.4911.04$0.3913.78
07-18895.300000$0.4910.82$0.3913.5
08-18895.370000$0.4910.96$0.3913.68
09-18895.500000$0.4911.22$0.4013.83
10-18895.400000$0.4911.02$0.4013.58
11-18895.350000$0.4910.92$0.4013.46
12-18895.320000$0.4910.86$0.4013.23
01-18905.380000$0.4910.98$0.3913.71
02-18905.320000$0.4910.86$0.3913.56
03-18905.280000$0.4910.78$0.3913.45
04-18905.390000$0.4911$0.3913.73
05-18905.620000$0.4911.47$0.4014.13
06-18905.580000$0.4911.39$0.4014.03
07-18905.540000$0.4911.31$0.4013.93
08-18905.410000$0.4911.04$0.4113.13
09-18905.320000$0.4910.86$0.4212.75
10-18905.080000$0.4910.37$0.4212.18
11-18904.710000$0.499.61$0.4111.56
12-18904.600000$0.499.39$0.4111.29
01-18914.840000$0.499.88$0.4012.03
02-18914.900000$0.4910$0.4112.03
03-18914.810000$0.499.82$0.4111.67
04-18914.970000$0.4910.14$0.4211.91
05-18914.950000$0.4910.1$0.4112.01
06-18914.850000$0.499.9$0.4012.06
07-18914.770000$0.499.73$0.4012
08-18914.930000$0.4910.06$0.4012.4
09-18915.330000$0.4910.88$0.3913.58
10-18915.330000$0.4910.88$0.3913.58
11-18915.250000$0.4910.71$0.3913.54
12-18915.410000$0.4911.04$0.3913.95
01-18925.510000$0.4911.24$0.3814.58
02-18925.520000$0.4911.27$0.3814.6
03-18925.580000$0.4911.39$0.3715.15
04-18925.570000$0.4911.37$0.3615.34
05-18925.570000$0.4911.37$0.3615.34
06-18925.540000$0.4911.31$0.3615.26
07-18925.540000$0.4911.31$0.3714.86
08-18925.620000$0.4911.47$0.3814.87
09-18925.480000$0.4911.18$0.3814.5
10-18925.590000$0.4911.41$0.3814.79
11-18925.570000$0.4911.37$0.3914.36
12-18925.510000$0.4911.24$0.3914.04
01-18935.610000$0.4911.45$0.4113.77
02-18935.510000$0.4911.24$0.4113.37
03-18935.310000$0.4910.84$0.4013.2
04-18935.310000$0.4910.84$0.4013.35
05-18934.840000$0.499.88$0.3912.33
06-18934.610000$0.499.41$0.3812.05
07-18934.180000$0.498.53$0.3711.21
08-18934.080000$0.498.33$0.3611.38
09-18934.370000$0.498.92$0.3711.72
10-18934.500000$0.499.18$0.3811.9
11-18934.570000$0.499.33$0.3712.41
12-18934.410000$0.499$0.3612.15
01-18944.320000$0.498.82$0.3512.23
02-18944.380000$0.498.94$0.3512.56
03-18944.510000$0.499.2$0.3413.31
04-18944.570000$0.499.33$0.3413.49
05-18944.400000$0.498.98$0.3412.99
06-18944.340000$0.498.86$0.3412.81
07-18944.250000$0.498.67$0.3412.54
08-18944.410000$0.499$0.3512.65
09-18944.480000$0.499.14$0.3512.68
10-18944.340000$0.498.86$0.3412.64
11-18944.340000$0.498.86$0.3412.64
12-18944.300000$0.498.78$0.3412.69
01-18954.250000$0.498.67$0.3412.54
02-18954.190000$0.498.55$0.3412.37
03-18954.190000$0.498.55$0.3412.37
04-18954.370000$0.498.92$0.3512.37
05-18954.610000$0.499.41$0.3612.86
06-18954.700000$0.499.59$0.3612.95
07-18954.720000$0.499.63$0.3613.17
08-18954.790000$0.499.78$0.3513.56
09-18954.820000$0.499.84$0.3513.64
10-18954.750000$0.499.69$0.3513.45
11-18954.590000$0.499.37$0.3512.99
12-18954.320000$0.498.82$0.3512.39
01-18964.270000$0.498.71$0.3412.43
02-18964.450000$0.499.08$0.3413.13
03-18964.380000$0.498.94$0.3412.93
04-18964.420000$0.499.02$0.3313.25
05-18964.400000$0.498.98$0.3313.39
06-18964.320000$0.498.82$0.3213.34
07-18964.040000$0.498.24$0.3212.47
08-18963.810000$0.497.78$0.3211.76
09-18964.010000$0.498.18$0.3212.38
10-18964.100000$0.498.37$0.3312.29
11-18964.380000$0.498.94$0.3412.75
12-18964.220000$0.498.61$0.3412.29
01-18974.220000$0.498.61$0.3312.65
02-18974.180000$0.498.53$0.3312.53
03-18974.190000$0.498.55$0.3312.56
04-18974.060000$0.498.29$0.3312.36
05-18974.080000$0.498.33$0.3212.6
06-18974.270000$0.498.71$0.3213.18
07-18974.460000$0.499.1$0.3213.77
08-18974.750000$0.499.69$0.3414.02
09-18974.980000$0.4910.16$0.3514.28
10-18974.820000$0.499.84$0.3414.03
11-18974.650000$0.499.49$0.3413.54
12-18974.750000$0.499.69$0.3413.83
01-18984.880000$0.499.96$0.3414.21
02-18984.870000$0.499.94$0.3513.97
03-18984.650000$0.499.49$0.3513.34
04-18984.570000$0.499.33$0.3513.11
05-18984.870000$0.499.94$0.3713.06
06-18985.060000$0.4910.33$0.3514.51
07-18985.080000$0.4910.37$0.3414.79
08-18985.270000$0.4910.76$0.3415.34
09-18985.260000$0.4910.73$0.3415.31
10-18985.150000$0.4910.51$0.3414.99
11-18985.320000$0.4910.86$0.3515.34
12-18985.650000$0.4911.53$0.3516.06
01-18996.080000$0.4912.41$0.3616.85
02-18996.310000$0.4912.88$0.3716.98
03-18996.400000$0.4913.06$0.3816.73
04-18996.480000$0.4913.22$0.3916.48
05-18996.210000$0.4912.67$0.4015.36
06-18996.070000$0.4912.39$0.4214.63
07-18996.280000$0.4912.82$0.4314.75
08-18996.440000$0.4913.14$0.4414.75
09-18996.370000$0.4913$0.4514.05
10-18996.340000$0.4912.94$0.4613.8
11-18996.460000$0.4913.18$0.4713.77
12-18996.020000$0.4912.29$0.4812.54
01-19006.100000$0.4912.45$0.4812.71
02-19006.210000$0.4912.67$0.4912.79
03-19006.260000$0.4912.78$0.4912.89
04-19006.340000$0.4912.94$0.4913.06
05-19006.040000$0.4912.33$0.4812.58
06-19005.860000$0.4911.96$0.4812.21
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12-192921.400000$1.6113.29$2.279.43
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02-193117.200000$1.6110.68$2.078.31
03-193117.530000$1.6110.89$2.068.52
04-193115.860000$1.619.85$2.047.76
05-193114.330000$1.618.9$2.027.1
06-193113.870000$1.618.61$1.996.96
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04-19336.890000$1.614.28$1.664.15
05-19338.870000$1.615.51$1.665.34
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10-20203418.700000$139.4724.51$141.3324.19
11-20203548.990000$139.4725.45$141.2425.13
12-20203695.310000$139.4726.5$141.3726.14
01-20213793.750000$139.4727.2$141.9726.72
02-20213883.430000$139.4727.84$142.7527.2
03-20213910.510000$139.4728.04$143.7627.2
04-20214141.180000$139.4729.69$144.9428.57
05-20214167.850000$148.5728.05$148.5728.05
06-20214238.490000$158.7626.7$158.7626.7
07-20214363.710000$164.3226.56$164.3226.56
08-20214454.210000$169.8726.22$169.8726.22
09-20214445.540000$175.4325.34$175.4325.34
10-20214460.710000$182.9124.39$182.9124.39
11-20214667.390000$190.3924.51$190.3924.51
12-20214674.770000$197.8723.63$197.8723.63
01-20224573.820000$197.8823.11$199.5422.92
02-20224435.980000$197.9022.42$201.3622.03
03-20224391.270000$197.9122.19$204.0421.52
04-20224391.300000$197.9122.19$205.1921.4
05-20224040.360000$197.9120.42$207.4519.48
06-20223898.950000$197.9119.7$210.3018.54
07-20223911.730000$197.9119.77$210.2818.6
08-20224158.560000$197.9121.01$210.2019.78
09-20223850.520000$197.9119.46$210.6518.28
10-20223726.050000$197.9118.83$211.5017.62
11-20223917.490000$197.9119.79$211.2918.54
12-20223912.380000$197.9119.77$210.6418.57
01-20233960.660000$197.9120.01$212.3318.65
02-20234079.680000$197.9120.61$213.5119.11
03-20233968.560000$197.9120.05$214.2018.53
04-20234121.470000$197.9120.82$214.9919.17
05-20234146.170000$197.9120.95$215.2519.26
06-20234345.370000$197.9121.96$215.6420.15
07-20234508.080000$197.9122.78$216.0020.87
08-20234464.050000$197.9122.56$217.3720.54
09-20234409.100000$197.9122.28$218.2320.2
10-20234269.400000$197.9121.57$218.3219.56
11-20234460.060000$197.9122.54$218.5320.41
12-20234685.050000$197.9123.67$218.6721.43
01-20244815.610000$197.9124.33$218.8922
02-20245011.960000$197.9125.32$220.2522.76
03-20245170.570000$197.9126.13$221.6723.33
04-20245112.490000$197.9125.83$222.5322.97
05-20245235.230000$197.9126.45$222.9023.49
06-20245415.140000$197.9127.36$222.9824.29
07-20245538.000000$197.9127.98$223.0224.83
08-20245478.210000$197.9127.68$222.9424.57
09-20245621.26$197.9128.4$223.3425.17

Using the S&P 500 Price to Peak Earnings Ratio Tool

The visualization above loops through all monthly earnings data on the S&P 500 and either uses the current month's TTM (trailing twelve month) earnings, the peak TTM earnings, or the inflation-adjusted peak earnings on the index.

Hover on the graph to see the point estimate of the price to peak earnings ratio, or find your desired month in the earnings table below.

Additionally, you can export all of the graph's data using the hamburger menu in the chart's upper right-hand corner.

S&P 500 Price to Peak Earnings Ratio Summary Statistics

The tool automatically recalculates the S&P 500 PPE every time you reload the page or when you toggle between CPI-adjusted and nominal index earnings. Note that the numbers below will change depending on your choice.

  • Current PPE (TTM) – The trailing twelve-month (TTM) price to peak earnings ratio for the S&P 500, either inflation-adjusted or nominal.
  • Average – The average Price to Peak Earnings ratio on the S&P 500, including pre-index history (see below)
  • Median – The median PPE ratio throughout history
  • Minimum – The minimum PPE ratio throughout history
  • Maximum – The maximum PPE ratio throughout history
  • Last Data Point – The last 'full month' of price data in the tool. Note that earnings may be from a previous date (due to either lack of data or higher past earnings.) 

What is the price to peak earnings ratio?

The price to peak earnings ratio is a security's price (or an index price) divided by the highest ever trailing twelve-month (TTM) earnings from that security (or index). It can be either the nominal – as earned – earnings or those earnings inflation-adjusted to present.

The idea of the price to peak earnings ratio is credit to John Hussman of Hussman Funds.

Why use peak earnings instead of earnings?

Hussman Funds' William Hester explained that price to peak earnings provides critical memory to valuation that looking at earnings snapshots can't necessarily provide. 

Earnings tend to have momentum; while boom times can somewhat inflate earnings, busts can cause companies to overstate their losses (or earnings dips). As stock prices theoretically are a claim on future earnings, peak earnings are a better steady-state starting point for future earnings estimates. The ten year price to earnings ratio (or CAPE) is another – more pessimistic – take on steady-state earnings. Either is an improvement on earnings snapshots in the price to earnings ratio – although they're, of course, not the final word on the subject.

Should you adjust peak earnings for inflation?

Maybe. I've built the tool both ways – you can choose to use the highest achieved earnings or the highest achieved earnings adjusted for inflation.

In theory, you would expect inflation to come back to company bottom lines – companies have pricing power. However, as large as the S&P 500 is, it doesn't capture all CPI inputs well (such as education) and is still majority US biased. 

A prime example of the latter came in the 1970s – rising oil prices were mostly due to overseas factors. Oil increased the input costs for many goods and services in the US, but company earnings potentials didn't rise much, if at all. That's a condition known as stagflation, where economic growth lags inflation: "stagnant growth and inflation."

However, most of the time (hopefully – I'm an optimist!), economic growth should outpace even rising inflation, and it's fair to use inflation-adjusted earnings.

S&P 500 Price to Peak Earnings Sources and Methodology

Monthly S&P earnings and index averages are from Robert Shiller. The S&P 500 started in 1957, with pre-history to 1926 – earlier data is from the Cowles datasets.

Those nice recession-era grey bars you see come from the National Bureau of Economic Research's "peak-to-trough" recession measure.

Other things to note:

  • Index price is the monthly average closing price.
  • Recent quarters that don't yet have earnings data are pulled forward from past results. Expect revisions if the current quarter is the highest earnings quarter in the dataset.

Other Measures of Market Valuation

Price to peak earnings is a relatively high-quality measure of market valuation. Not perfect, mind you – 'earnings' aren't always the most important metric to a company, so different industry mixes will also affect the metrics' usefulness.

Here are some other measures of US stock market valuation:

      

PK

PK started DQYDJ in 2009 to research and discuss finance and investing and help answer financial questions. He's expanded DQYDJ to build visualizations, calculators, and interactive tools.

PK lives in New Hampshire with his wife, kids, and dog.

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