Valuations Update of STI

Current P/E of STI – 6.84x

Current P/B of STI – 1.34x

Mean P/E of STI – 16.3x

Mean P/B of STI – 1.73x

P/B of STI to be in “crisis range” – 0.98x (or -2SD)

P/B range of 0.7-1.2x in past crises

When STI is declining, it’s better to look at P/B than P/E as the earnings will usually drop if the crisis lasts long. This phenomenon will cause an inflated P/E as the denominator becomes smaller.

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6 thoughts on “Valuations Update of STI

  1. Hi FFN,

    If I would like to check back on the P/E, P/B values of KLCI a year ago, how do I get it from the site?

    Thanks, u have been very helpful to your readers.

  2. Current P/E of STI – 9x now, gone up from the time of your post in Jan 2012. But P/B is 1.26, down from 1.34. Is this the scenario you described about P/E rising as Earnings drop?

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