Investing Basics

Understanding and Using the P/E Ratio: A Guide for Investors

Explaining the go-to valuation metric

Photo by Markus Winkler on Unsplash

The P/E ratio is a financial metric used to evaluate a company’s stock price relative to its earnings. It is calculated by dividing the stock price by earnings per share. It is commonly used by investors to determine if a stock is overvalued or…