Definitions for "PE Ratio"
Keywords:  earnings, ratio, divided, diluted, eps
Share price divided by earnings per share.... more on: PE ratio
The price-to-earnings ratio (PE ratio) is a tool that helps investors evaluate a company. Calculate this ratio by dividing the price of one share of a company's stock by the company's earnings per share over a 12-month period.
Price-Earnings Ratio, calculated by dividing the share price by the company's latest available earnings per share (EPS). There are several variants to this calculation including Diluted PE Ratio, PE Ratio before Abnormal Items etc. It is commonly used as a rule of thumb to determine whether or not a company's shares are reasonably priced by the market.