Stock Valuations Remain Near Record High Including in Europe and EM

Even as stock prices have corrected in recent weeks with only 36% of stocks having positive performance over the last 200 days and the average stock 19% from its one year high, we are reminded that stock valuations are still stretched pretty much everywhere. In the charts below we show the trusty price to cash flow ratio for the median stock in the developed world regions and also in the EMs. We highlight that even in areas of the market that have underperformed dramatically over the last four years (namely EM and Europe) the price to cash flow ratio for the median stock is still quite elevated relative to history.