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Price-to-earnings ratio explained


Price-to-earnings ratio explained
© small smiles/ iStock
Gain-loss balanced on a scale
When a shopper goes looking for a new appliance, perhaps a coffee maker, they may ask themselves questions like: “Is this worth the price?” and “What type of lifetime value will I get out of the purchase?”
These are great questions to ask about any purchase, stocks included. And inquiries into a stock’s price and value are cornerstones of stock market research.
Investors may frame the questions like this: “Is this stock worth it for the price?” and “What type of value will I get out of this stock?” ....

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