Friday, June 28, 2019 12:32:02 AM
$LAHI ..The Shiller P/E is a more reasonable market valuation indicator than the P/E ratio because it eliminates fluctuation of the ratio caused by the variation of profit margins during business cycles.
Sector Healthcare: 30.50
Sector Texhnology: 34.40
Why Is the Regular P/E Ratio Deceiving?
The regular P/E uses the ratio of the S&P 500 index over the trailing-12-month earnings of S&P 500 companies. During economic expansions, companies have high profit margins and earnings. The P/E ratio then becomes artificially low due to higher earnings. During recessions, profit margins are low and earnings are low. Then the regular P/E ratio becomes higher. It is most obvious in the chart below:
https://www.gurufocus.com/shiller-PE.php
http://www.econ.yale.edu/~shiller/
Nasdaq biotech triple vs..
$LAHO GSCG higher valuation per Professor Schiller proven over two decades, regenerative treatment is much in demand.
Sector Healthcare: 30.50
Sector Texhnology: 34.40
Why Is the Regular P/E Ratio Deceiving?
The regular P/E uses the ratio of the S&P 500 index over the trailing-12-month earnings of S&P 500 companies. During economic expansions, companies have high profit margins and earnings. The P/E ratio then becomes artificially low due to higher earnings. During recessions, profit margins are low and earnings are low. Then the regular P/E ratio becomes higher. It is most obvious in the chart below:
https://www.gurufocus.com/shiller-PE.php
http://www.econ.yale.edu/~shiller/
Nasdaq biotech triple vs..
$LAHO GSCG higher valuation per Professor Schiller proven over two decades, regenerative treatment is much in demand.
Join the InvestorsHub Community
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
