Typically, the average P/E ratio is around 20 to 25. Anything below that would be considered a good price-to-earnings ratio, whereas anything above that would be a worse P/E ratio. But it doesn't stop there, as different industries can have different average P/E ratios.
PE ratio = Price/Earnings
For example, if XYZ stock has a P/E ratio of 100, it means that investors are willing to pay Rs. 100 for every Rs. 1 of profit made by XYZ.
What does a price to earnings ratio (P/E) of over 200 times for a stock mean? It means that if you were to hypothetically buy 100% of the company's shares, it would take 200 years for you to earn back your initial investment through the company's ongoing profits.
All else equal, the lower the P/E ratio, the better the investment. For this reason, a P/E of less than 20x is “good” and anything higher than 30x is “bad.” But the P/E ratio can be misleading. A low P/E doesn't necessarily indicate a good investment.
The relative P/E will have a value below 100% if the current P/E is lower than the past value (whether the past is high or low). If the relative P/E measure is 100% or more, this tells investors that the current P/E has reached or surpassed the past value.
To give you some sense of what the average for the market is, though, many value investors would refer to 20 to 25 as the average P/E ratio range. And again, like golf, the lower the P/E ratio a company has, the better an investment the metric is saying it is.
In May 2009, the P/E ratio reached a staggering 123.73x, the highest ratio in United States history. This was primarily due to the depressed earnings during the “Great Recession” and has been the only instance since 1970 in which the P/E ratio reached triple digits.
According to Tesla's latest financial reports and stock price the company's current price-to-earnings ratio (TTM) is 118.273. At the end of 2022 the company had a P/E ratio of 30.6.
Why is Amazon's price-to-earnings ratio so high? It's simple—Amazon doesn't trade based on earnings. Amazon stock's P/E ratio is so high because the company continues to invest in R&D, which increases their capital expenditure AND lower their reported earnings.
Apple (AAPL) PE Ratio (TTM) : 38.55 (As of Jan. 14, 2025)
A higher PE suggests high expectations for future growth, perhaps because the company is small or is an a rapidly expanding market. For others, a low PE is preferred, since it suggests expectations are not too high and the company is more likely to outperform earnings forecasts.
PE100 is the third generation of pipe grade PE.
It has an optimum balance of three key properties: Minimum Required Strength (MRS) – this provides long-term strength and creep resistance. Stress crack resistance (sometimes referred to as slow crack growth resistance). Rapid crack propagation resistance.
Thus, the evidence is overwhelming that low PE stocks earn higher returns than high PE stocks over long periods. Those studies that adjust for differences in risk across stocks confirm that low PE stocks continue to earn higher returns after adjusting for risk.
Fair Value Estimate for Nvidia
With its 2-star rating, we believe Nvidia's stock is overvalued compared to our long-term fair value estimate of $105 per share, which implies an equity value of roughly $2.5 trillion.
The PE Ratio (TTM), or Price-to-Earnings ratio, or P/E Ratio, is a financial ratio used to compare a company's market price to its Earnings per Share (Diluted). As of today (2025-01-07), Robinhood Markets's share price is $40.8785.
A negative P/E ratio means that the company reported either no earnings per share (EPS) or negative EPS. A negative P/E ratio suggests the company is currently unprofitable, as it has more expenses than revenue. It often means the company made no money over the last 12 months.
The mean historical PE ratio of Costco Wholesale over the last ten years is 35.42. The current 54.17 P/E ratio is 53% higher than the historical average. Looking back at the last ten years, COST's PE ratio peaked in the Nov 2024 quarter at 56.47, with a price of $964.01 and an EPS of $17.07.
P/E ratio as of January 2025 (TTM): 6.32
According to Ford's latest financial reports and stock price the company's current price-to-earnings ratio (TTM) is 6.32143. At the end of 2022 the company had a P/E ratio of -23.3.
Investors and analysts consider stocks which have a P/E ratio of 50 or above to be an overvalued share, especially in comparison to a stock which has a ratio at par with or below 10. As it allows investors to determine that its share prices are considerably higher than what a company can afford to pay as dividends.
Min: 17.2 Med: 28.55 Max: 66.05
During the past 13 years, the highest PE Ratio (TTM) of Alphabet(Google) was 66.05.
According to Toyota's latest financial reports and stock price the company's current price-to-earnings ratio (TTM) is 9.18095. At the end of 2022 the company had a P/E ratio of 10.2.
The mean historical PE ratio of Pfizer over the last ten years is 20.1. The current 35.38 P/E ratio is 76% higher than the historical average. Looking back at the last ten years, PFE's PE ratio peaked in the Dec 2023 quarter at 75.76, with a price of $28.79 and an EPS of $0.38.
As of today (2025-01-13), NVIDIA's share price is $132.105. NVIDIA's Earnings per Share (Diluted) for the trailing twelve months (TTM) ended in Oct. 2024 was $2.54. Therefore, NVIDIA's PE Ratio (TTM) for today is 51.99.