In valuing companies or indexes, one must look at the earnings or cash flow statements, and the balance sheet. The former are flow measures, measuring performance over a period, versus the balance sheet which attempts to measure the value of the company on an amortized cost basis (with varying accuracy).
There are advantages to each method. My view of it is over the short-run, flow measures are the most meaningful. Over the long-run stock measures are the most meaningful, because over the long run the returns from assets or net worth are more regular than those versus other flow measures.
That is why I focus on longer term valuation measures among short-term valuation measures that are neutral at best at present, Mean-reversion eventually takes hold.