Average PE of Nifty in the last 20 years was around 20. * So PEs below 20 may provide good investment opportunities; lower the PE below 20, more attractive the investment potential.
Very low vs very high PE ratios
It is arguable that a PE of five or less is not a remarkable bargain. While it might look as if the company's prospects are being viewed too negatively, it is not a bad rule of thumb to filter out companies with a PE below this level.
BBY (Best Buy Co) PE Ratio (TTM) : 14.73 (As of Jan. 03, 2025)
A Shiller P/E value of 30 or more is considered to be danger territory that a stock crash is coming (according to some experts - arguable).
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.
According to Tesla's latest financial reports and stock price the company's current price-to-earnings ratio (TTM) is 115.76. At the end of 2022 the company had a P/E ratio of 30.6.
As of today (2025-01-13), Target's share price is $138.77. Target's Earnings per Share (Diluted) for the trailing twelve months (TTM) ended in Oct. 2024 was $9.43. Therefore, Target's PE Ratio (TTM) for today is 14.72.
Apple (AAPL) PE Ratio (TTM) : 38.55 (As of Jan. 14, 2025)
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.
A good PE (Price to Earnings) ratio in India usually falls between 12 and 20, indicating that a company's stock is neither overvalued nor undervalued. This range balances risk and growth potential, making it ideal for Indian stock market investment.
S&P 500 P/E Ratio is at a current level of 28.77, up from 27.87 last quarter and up from 23.27 one year ago. This is a change of 3.23% from last quarter and 23.62% from one year ago. The S&P 500 PE Ratio is the price to earnings ratio of the constituents of the S&P 500.
PE Ratio Meaning
P/E Ratio or Price to Earnings Ratio is the ratio of the current price of a company's share in relation to its earnings per share (EPS).
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.
In simple terms, a good P/E ratio is lower than the average P/E ratio, which is between 20–25. When looking at the P/E ratio alone, the lower it is, the better. For new investors, “P/E” might as well mean “physical education.”
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.
The justified price to earnings ratio is the price to earnings ratio that is “justified” by using the Gordon Growth Model. This version of the popular P/E ratio uses a variety of underlying fundamental factors such as cost of equity and growth rate.
A high P/E ratio can mean that a stock's price is high relative to earnings and possibly overvalued. A low P/E ratio might indicate that the current stock price is low relative to earnings.
The mean historical PE Ratio of Carvana Co. over the last ten years is -19.64. The current -4826.50 PE Ratio has changed 2.46% with respect to the historical average. Over the past ten years (40 quarters), CVNA's PE Ratio was at its highest in in the June 2021 quarter at 279.18.
According to Apple's latest financial reports and stock price the company's current price-to-earnings ratio (TTM) is 38.4893. At the end of 2023 the company had a P/E ratio of 29.8.
The PE ratio for Amazon Com stock stands at 45.9 as of Jan 10, 2025. This is calculated based on the TTM EPS of $4.77 and the stock price of $218.94 per share.
As of today (2025-01-13), Walmart's share price is $93.00. Walmart's Earnings per Share (Diluted) for the trailing twelve months (TTM) ended in Oct. 2024 was $2.44. Therefore, Walmart's PE Ratio (TTM) for today is 38.16.