The stock market could be in trouble after its historic surge from the late-March lows as valuations become increasingly elevated, data compiled by RBC Capital Markets showed.
The S&P 500′s trailing price-to-earnings ratio, a widely used valuation metric, is currently sitting at 21.61. That’s near the highs seen in early 2020, when the broader market index was trading at an all-time high. The forward S&P 500 PE ratio, which is measured using earnings estimates for the next 12 months, has jumped to 22.18, near its highest levels in almost two decades.
