What’s It Worth? A Guide to Valuations in Low-Visibility Markets
- Stock watchers focus on cash flow and book value over earnings
- Currency strategists weigh models to assess fundamentals
This article is for subscribers only.
Is it cheap or expensive?
It used to be a question that strategists answered with a simple formula, but it’s turned into a fool’s errand. The S&P 500 Index’s 12% rally in April and sharp fall in profit estimates sent its forward price-to-earnings ratio to the most expensive level in almost two decades. In the words of Muddy Waters Capital founder Carson Block, “It makes no sense.”