Price Earning ratio
Define the term Price Earning ratio and how it is calculated?
Expert
Price Earning ratio:
Price earnings ratio commonly known as P/E ratio helps in the assessment of the company’s current share price in relation to its earnings.
It is calculated as:-
We can say MPS÷EPS of the stock of the company.The P/E ratio can be calculated for the past year as well as for the future years. In both the situations the market price remains as the current stock price of the company. Earnings shall vary w.r.t the year – actual earnings or the projected earnings as the case may be. Example: if the company is trading at 60$ and the earnings of the last 12 months were 2$ then per share then the P/E ratio is 30.Interpretation:• The ratio reflects the price being paid by the market for each rupee of reported EPS. The ratio shall measure the expectations of the market and the investors. It shall depict the performance of the firm in the industry.• Shares which have high growth rate shall have high P/E ratio since investors are ready to pay more for them. But if the risk factor in the share increases the market price of the share gets affected adversely and so is the P/E ratio of the firm.• From the investment point of view of the investor the ratio shall help in deciding whether:--To purchase the shares of the firm or-To refrain from purchasing the shares.
Why do financial managers compute the marginal tax rate?Financial managers utilize marginal tax rates to estimate the future after tax cash flows from investments. Because they are interested in how much of the next dollar earned through n
i want to write final state report. My state is Texas. You can use the resources that i attached, also you can use another resources to cover the outlines.
Uniform Codes Manual (UCM): It is a document sustained by the Department of Finance that sets standards for codes and different other information employed in state fiscal reporting systems. Such codes recognize, for illustration, prog
My Assignment is writing a Three page paper including executive Summary and investing 1million Dollars in Stocks, Bonds and Mutual Funds and Other Assets and Recording Each Investments made Every Friday of the week, Beginning On September 7th to October 30 on An excel spreadsheet which has been crea
Fin 235 Personal Finance Homework Chapter 8: Problems: 1, 3, 5, 7 1. Most home insurance policies cover jewelry for $1,000 and silverware for $2,500 unless items are covered with additional insurance. If a family
Describe financial ratio? This is a number which expresses the value of one financial variable relative to another. Put more cleanly, a financial ratio is the result you obtain when you divide one financial number by another. Computing an
Normal 0 false false
Schedule of Operating Expenses and Equipment, Supplementary: The supplemental schedule proposed by department’s throughout budget preparation that details by object the expenses comprised in the Operating Expenses and Equipment class.
Assume the market for widgets can be described by the given equations: Demand: P = 10 - Q &
Section 1.80: The section of Budget Act which comprises the periods of accessibility for Budget Act appropriations.
18,76,764
1947755 Asked
3,689
Active Tutors
1417145
Questions Answered
Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!!