High PE Ratio Means What? A Good Stock?

P/E Ratio
Knowledge Center

 

Next Topic

P/E Ratio > Forum > High PE Ratio Means What? A Good Stock?

High PE Ratio Means What? A Good Stock?
Manoj Jayale, Manager, India, Member
What is the meaning if Company A has been trading at a higher PE ratio than company B?
Does it mean we should buy this stock or not?
Can anyone explain? Thanks...
 

 
Meaning of P/E Ratio
Rajiv Singh, Student (University), United Kingdom, Member
No, it does NOT mean a good stock, nor a bad one. It just means how much a company is earning per share.
How strong the stock of a company is, also depends upon the volume of stock a company is using to trade.
When the company's P/E ratio is low this means it is generating a low income per share. However, how much total earnings it accumulates can be calculated by:
Earning per share * total volume traded.
 

     

Read all responses and join this discussion yourself.
Support your career and personal development with 12manage, the management platform.

    Log in


Special Interest Group Leader

Interested? Sign up for free.


P/E Ratio
Summary
Forum
Best Practices


    P/E Ratio
    Knowledge Center

     

    Next Topic



    About 12manage | Advertising | Link to us / Cite us | Privacy | Suggestions | Terms of Service
    2019 12manage - The Executive Fast Track. V15.2 - Last updated: 20-11-2019. All names of their owners.