Size - Size +
Premium Feature Welcome:
Index | My Account

Value Line University

Using P/E Information

You can use the P/E as a factor to help evaluate whether or not to buy a particular stock at a particular time.

  1. If you believe that earnings are going up and that the current price/earnings ratio will be maintained, you might want to buy now, because you may benefit from a future earnings increase.
  2. If the earnings estimate is for continued growth but the P/E is already high, you may want to wait for a dip in prices in the market as a whole for an opportunity to buy without paying more than you want to for the stock based on the total return you anticipate.
Home | Site Requirements | Terms & Conditions | Privacy Statement | Support
Education | Products & Services | Research Center | About Value Line | Sitemap
Copyright © Value Line, Inc.