PE ratio is calculated by dividing the share price with earnings per share (EPS). Theoretically, PE ratio tells us how much investor is willing to pay for per dollar of company profits. If the share price grows along with the company profit, the PE ratio remains fairly consistent (a good sign).
Generally speaking, the P/E ratio is a better indicator of the value of a share than the share price alone. With our PE Dashboard, now you can analyse the historical trend of PE of a specific stock or index. This in turn will enable you to:
- Determine the attractiveness of a stocks price relative to overall market (Stock PE ratio vs the Index PE)
- Determine the attractiveness of a stocks price relative to its peer companies (Stock PE ratio vs Sectoral Index PE)