| | | I think you get a similar Buffet Buy signal for Merck & Company (MRK) too. Both have exposure to potential China tariffs and have sold off to historically low PE's.
Then compare to the mean $SPX PE
5-year historical PE ratio:
The S&P 500 PE ratio has fluctuated over the past 5 years. As of September 2024, it was 28.77, up from 23.27 one year ago, representing a 23.64% increase 1.
10-year historical PE ratio:
Over the past 10 years, the S&P 500 PE ratio has shown significant variation. In September 2014, it was 18.61, and it has generally trended upward since then 1.
Current PE ratio:
As of February 13, 2025, the S&P 500 PE ratio was 30.534
As the market rotates into different sectors, I am scanning cyclicals w/ low PEs looking for those w/ PE expansion to their mean. $SPX PE too high for me for other buys other than special situations.
Cyclical stocks: what are they and why you should care
2. Industrial cyclical stocks These companies are involved in sectors like manufacturing, construction, and infrastructure. Their performance typically peaks during periods of economic growth when there is high demand for capital goods and construction projects.
Examples:
- Construction equipment. Caterpillar and Komatsu, which produce heavy machinery and industrial equipment used in construction and infrastructure projects.
- Aerospace manufacturing. Airbus and Boeing, which rely on demand for commercial aircraft that increases during economic expansions.
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