Price/Earnings Ratio

Benchmark: 15

Share price divided by adjusted earnings per share, in other words, how many times the share price covers company profit per share.  Fully diluted earnings per share should be taken, inclusive of other operating income.  Shows the level of confidence in the company on the stock market.  The ratio is subject to change on the stock market on a day-to-day basis, as share prices rise and fall.

« Back to Calculations Index