What is PE ex cash?

The cash holdings of the company (per share) are subtracted from the price (per share) of the stock before dividing by the earnings per share. This is a popular thing to do with companies like Apple which have large cash reserves. It makes the P/E Ratio look smaller and the company look cheaper to potential investors.

What is a good EPS ratio?

Specifially, stocks with EPS growth rates of at least 25\% compared with year-ago levels suggest a company has products or services in strong demand. It’s even better if the EPS growth rate has been accelerating in recent quarters and years.

What is the difference between PE ratio and EPS?

The basic definition of a P/E ratio is stock price divided by earnings per share (EPS). EPS is the bottom-line measure of a company’s profitability and it’s basically defined as net income divided by the number of outstanding shares. Earnings yield is defined as EPS divided by the stock price (E/P).

What does PE price earning ratio tell you?

In short, the P/E ratio shows what the market is willing to pay today for a stock based on its past or future earnings. A high P/E could mean that a stock’s price is high relative to earnings and possibly overvalued. Conversely, a low P/E might indicate that the current stock price is low relative to earnings.

Is a negative PE ratio good?

A negative P/E ratio means the company has negative earnings or is losing money. However, companies that consistently show a negative P/E ratio are not generating sufficient profit and run the risk of bankruptcy. A negative P/E may not be reported.

How do you calculate price-to-earnings ratio?

P/E Ratio is calculated by dividing the market price of a share by the earnings per share. For instance, the market price of a share of the Company ABC is Rs 90 and the earnings per share are Rs 10. P/E = 90 / 9 = 10.

What is PE ratio – price to earnings ratio?

PE Ratio – Price to Earnings Ratio 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).

How do you calculate P/E (ex cash)?

So, P/E (ex cash) = (Market Value – Cash and cash equivalents)/Net Income. There is a very good reason why this is done.

What is the difference between Peg and P/E ratio?

The price/earnings-to-growth (PEG) ratio is a company’s stock price to earnings ratio divided by the growth rate of its earnings for a specified time period. Forward price-to-earnings (forward P/E) is a measure of the P/E ratio using forecasted earnings for the P/E calculation.

What is the basic P/E ratio formula?

P/E Ratio Formula Explanation The basic P/E formula takes the current stock price and EPS to find the current P/E. EPS is found by taking earnings from the last twelve months divided by the weighted average shares outstanding