|
|
|
Price Earnings Ratio (PE)
|
The market price of a share divided by the company's Earnings(profits) per share in its latest 12 month trading period.
The P/E ratio of a stock (also called its "Earnings multiple", or simply "multiple", "P/E", or "PE") is a measure of the price paid for a share relative to the annual income or profit earned by the firm per share.A higher P/E ratio means that investors are paying more for each unit of income. By comparing price and Earnings per share for a company, one can analyze the market's stock Valuation of a company and its shares relative to the income the company is actually generating. Investors can use the P/E ratio to compare the value of stocks.
|
| Posted by
Information Management Network LLC.
|
|
