Money
S&P 500 Without Magnificent Seven Trades at Only 19 Times Earnings
We Study Billionaires
TIP823: From Railroads to AI: The Timeless Patterns Behind Market Bubbles w/ Kyle Grieve
"The P/E ratio of the S&P 500 at the end of 2025 was 31 times. So if I remove the Magnificent Seven and I just keep the awful 493, which I recently saw it referred to as, it's only 19 times earnings. So this shows that the average American business just hasn't really improved that much. The index as a whole is just being propped up by a few outperforming businesses."
Grieve presented data showing the S&P 500's 31x P/E ratio is driven entirely by the Magnificent Seven, while the remaining 493 companies trade at just 19x earnings. This concentration reveals the index is being propped up by a handful of AI-focused mega-caps while the average American business remains stagnant, raising questions about market breadth and sustainability.
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