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.