price earnings ratio

Definitions from the Web

A price earnings ratio (P/E ratio) is a financial metric used to determine the relative value of a company's stock. It compares the current market price of a stock to the company's earnings per share (EPS).

Sample sentences:

The price earnings ratio for XYZ Company is 15, which indicates that investors are willing to pay 15 times the company's earnings for one share of stock.
A low price earnings ratio suggests that a company's stock is undervalued, whereas a high P/E ratio may indicate it is overvalued.
When analyzing investment options, it is important to consider the price earnings ratio of different companies.