From January through March, the EPS estimate on the S&P was 240 for 2022. If you apply a 17x P/E multiple (which is arguably a fair middle ground between 15-20x P/E if you assume Fed Funds Rate between 2-3%) that would put you at S&P 4080 (or SPY ~408).
However, EPS estimates recently came down to 225 for 2022. So again, if you believe that the Fed will at least get to neutral (FFR 2.5% – 3%), and you apply a 17x P/E multiple, that would put you around 3825 (or SPY ~382).
This also assumes no recession this year or next year of course. In a recession, the E will come down further, so you get both multiple compression and earnings reduction which can make P/E's looked whacked out (ie: stocks look cheap on a relative basis, but because earnings will come down, they aren't as cheap as they appear).
All in all, you get to decide which P/E multiple you want to apply to EPS estimates. I like to think of it as a possible trading range, which helps me reduce FOMO or Fear.
Curious to hear some thoughts on this.
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