The S&P 500 finished up 4.4% in December to close out a strong 2021. At year-end, the 505 firms in the index were cumulatively valued over $42 trillion. The top 10 constituents comprised 29.3% of the total weight of all companies in the index. For perspective, the top weighted company, Apple, ended the year valued over $3 trillion, or roughly 7% of the total index value.
With the S&P 500 valued over 21.0 times forward earnings expectations, interest rates and corporate earnings have a lot of lifting to do to keep valuations at such lofty levels.
The chart below highlights recent prices, total returns (total return always includes dividends), dividend yields, and trailing and forward-looking P/E’s for several major indices.
|
Market |
Closing |
Closing |
YTD |
Yield |
Trailing |
Forward Estimate P/E |
|
S&P 500 |
3,756 | 4,766 | 28.7% | 1.3% | 27.0x |
21.4x |
|
DJIA |
30,606 | 36,338 | 20.9% | 1.9% | 20.8x |
17.8x |
|
S&P US Aggregate Bond Index |
-1.4% |
1.6% |
*Statistics on S&P 500 index, DJIA index, and S&P US Aggregate Bond index from S&P Dow Jones Indices.
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Disclaimer
This material is provided by Schmitt Wealth Advisers for informational purposes only. Schmitt Wealth Advisers does not provide tax or legal advice, and nothing herein should be construed as such. It is not intended to serve as a substitute for personalized investment advice or as a recommendation or solicitation of any particular security, strategy, or investment product. Opinions expressed by Schmitt Wealth Advisers are based on economic or market conditions at the time this material was written. Economies and markets fluctuate. Actual economic or market events may turn out differently than anticipated. Facts presented have been obtained from publicly available sources (unless otherwise noted) and are believed to be reliable. Schmitt Wealth Advisers, however, cannot guarantee the accuracy or completeness of such information. Past performance may not be indicative of future results.
