The Market Is Speaking. Valuation Is Listening.

One of the most misunderstood aspects of Structural Valuation Analysis is that it does not stop at individual stocks. The same valuation discipline that governs businesses also applies to entire markets.

That matters, because when markets move through key valuation levels, the implications are often far more important than any headline or forecast.

In this week’s Weekly Focus, Ross Healy walks through what the current valuation structure is telling us about the S&P 500 and the NASDAQ, and why this moment matters.

👉 Watch the full Weekly Focus video here:
https://youtu.be/RXpnNQafXVU

The NASDAQ 100 and a Familiar Ceiling

When we examine the NASDAQ 100 through the lens of valuation, we see a familiar pattern. Over the past five years, the index has repeatedly turned near its HB1 price, approximately nine and a half times adjusted book value.

That valuation level is not arbitrary. It is the same peak valuation reached during the year 2000.

While this is an important observation, the more compelling development today lies elsewhere.

Why the S&P 500 Matters More Right Now

The S&P 500 appears to be breaking above its low super-growth valuation level, roughly four and a half times adjusted book value.

If this breakout holds, history suggests there is meaningful upside potential. From that valuation threshold alone, the implied upside is approximately 22 percent. Given how far the market has already advanced, that translates to roughly another 18 percent from current levels.

This is how markets often behave when valuation barriers are crossed. A breakout does not usually stop at the first level. It often carries through to subsequent valuation ranges.

No promises. Just probabilities.

Melt-Ups Ignore Valuation Until They Don’t

It is already evident that many S&P 500 stocks are making new all-time highs while sitting well above their fair market values.

In a normal environment, that would matter. In a melt-up environment, it often does not.

This is precisely why discipline matters more than opinion. Valuation tells you where risk accumulates, not when sentiment will change.

A Reminder From 2020

To understand the precision of valuation, it is worth revisiting March 2020.

At that time, the S&P 500 was collapsing rapidly. Using SVA, the market’s growth price was calculated at approximately 2190, or two times adjusted book value.

The market bottomed on March 23, 2020 at 2191.86.

That was not luck. That was valuation.

Final Thoughts

The message today is simple.

Ignore the bears. Ignore the noise. Pay attention to the valuation structure underneath the market.

If this breakout holds, the path forward may be higher than many expect.