PE ratio
WHAT IS IT ?
The price-earnings ratio (P/E ratio) is a valuation measure that compares the level of stock prices to the level of corporate profits, providing investors with a sense of a . stock’s value.
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CALCULATION:
EXAMPLE:
The current market value of a stock or other asset is 102 Euros. The profit after tax attributable to one share or another unit of the asset is 5.21 Euros.
Thus,
PE = 102 / 5.21
PE = 19.58
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