Looking Back to 1880, Stocks Are Pricey. How They Keep Climbing.
Affected assets and topics
Why it matters
The S&P 500's current Shiller CAPE ratio is at 40 times, indicating that stocks may be overvalued compared to historical averages, with the metric suggesting a more sustainable assessment of earnings power than the traditional price-to-earnings ratio.
Expected market reaction
Market impact analysis based on bearish sentiment with 70% confidence.
Evidence trail
Evidence
AI provenance
Technical identifiers
- Provider tag
- groq-llama-3.1-8b-instant
- Analysis version
- groq-llama-3.1-8b-instant
- Article id
- 33720
Original source
The Shiller cyclically adjusted price-to-earnings (CAPE) ratio is a valuation measure that divides a stock’s current price by the average of the last 10 years’ inflation-adjusted earnings. This tactic is a better way to assess sustainable earnings power than the typical price-to-earnings ratio, since that only takes one year into account, he wrote in a Friday note. The S&P 500’s current Shiller CAPE ratio is at roughly 40 times.
Read the full article on Yahoo Finance
Original article published by Yahoo Finance on January 16, 2026. Analysis and insights provided by AnalystMarkets AI.
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