Definition of 'Price-Earnings Ratio - P/E Ratio'
A valuation ratio of a company's current share price compared to its per-share earnings.
Calculated as:
Market Value per Share / Earnings per Share (EPS)
For example, if a company is currently trading at $43 a share and earnings over the last 12 months were $1.95 per share, the P/E ratio for the stock would be 22.05 ($43/$1.95).
A valuation ratio of a company's current share price compared to its per-share earnings.
Calculated as:
Market Value per Share / Earnings per Share (EPS)
For example, if a company is currently trading at $43 a share and earnings over the last 12 months were $1.95 per share, the P/E ratio for the stock would be 22.05 ($43/$1.95).
No comments:
Post a Comment