Live · As of September 2026
Refreshed 17m ago
S&P 500 P/E Ratio
Price-to-earnings ratio for the S&P 500 — how much investors pay for each dollar of corporate profit. The Shiller PE (CAPE) smooths earnings over a 10-year inflation-adjusted window to filter out cyclical swings.
Historical Chart
What it means
A high P/E ratio means investors are paying a lot per dollar of earnings — either because they expect rapid future growth or because the market is overpriced. The Shiller PE (CAPE) is preferred for long-horizon comparisons because it averages real earnings over 10 years, removing the boom-bust noise that distorts the trailing P/E during recessions.
Data sourced from Robert Shiller's long-running dataset via multpl.com, refreshed every few hours.
Zones (Shiller PE)
- Strongly Undervalued< 12
- Undervalued12 – 17
- Fair Value17 – 22
- Overvalued22 – 30
- Strongly Overvalued> 30
Buffett on P/E
How the world's most famous value investor thinks about price-to-earnings — in his own words.
Price is what you pay, value is what you get.
P/E only matters relative to the quality and durability of the earnings behind it.
It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price.
Why he paid 20–25× earnings for See's, Coca-Cola, and Apple. A low P/E in a declining business is usually a value trap.
In the short run, the market is a voting machine, but in the long run, it is a weighing machine.
Short-term P/E swings are sentiment. Long-term P/E reflects real earning power.
The ratio of total market cap to GNP is probably the best single measure of where valuations stand at any given moment.
His preferred market-level gauge is Market Cap / GDP — not the aggregate P/E — though he still watches CAPE as a sanity check.
How Buffett actually reads P/E
- Owner earnings over EPS. He prefers free cash flow after maintenance capex to reported accounting earnings, which can be distorted by depreciation schedules, one-offs, and aggressive buybacks.
- P/E plus return on capital. A 25× business compounding at 20% ROIC is cheaper than a 10× business stuck at 6%. Multiple alone tells you nothing.
- Durability of earnings. He pays up for moats — brand, scale, switching costs — because the “E” will still be there in 20 years.
- Beware single-digit P/Es. Cheap multiples in fading businesses (newspapers, textiles — his original Berkshire mistake) are traps, not bargains.