The S&P's GAAP P/E Ratio Rises Above 19X

Goldman may have been right that there will be no more multiple expansion in 2015, but there sure was quite a bit overnight thanks to the latest verbal and actual central bank interventions by the ECB and the PBOC. And as a result, the biggest beneficiary is the S&P500, which is set to open just around 2070, or about 30 points shy of Goldman's 2015 S&P500 year-end target.

And for those who still care about such things, the chart below shows that fundamentally, the S&P is now trading at 17.5x non-GAAP LTM EPS, and, drumroll, 19.2X GAAP PE!

At the current daily pace of increase, David Tepper can finally pop that champagne bottle early next week, because his long-held dream of a 20X P/E (GAAP that is) will have finally materialized (he may have to wait until Christmas for 20x non-GAAP).

And all it took was the coordinated intervention of every single developed and developing central bank.

Disclosure: Copyright ©2009-2014 Media, LTD; All Rights Reserved. Zero Hedge is intended for Mature Audiences. Familiarize yourself with our legal and use policies every time ...

How did you like this article? Let us know so we can better customize your reading experience.


Leave a comment to automatically be entered into our contest to win a free Echo Show.
Moon Kil Woong 9 years ago Contributor's comment

Yay, coordination probably means that their economies will all pop spectacularly at the same time. In general we all know why this is dumb, dumb, dumb. It's because such global economic asset based pops are much worse than regional downturns.