Multiple

Filed Under »
Dictionary Says

Definition of 'Multiple'

A term that measures some aspect of a company's financial well-being, determined by dividing one metric by another metric. The metric in the numerator is typically larger than the one in the denominator, because the top metric is usually supposed to be many times larger than the bottom metric. 

Calculated as:

Multiple
Investopedia Says

Investopedia explains 'Multiple'

For example, the term multiple can be used to show how much investors are willing to pay per dollar of earnings, as computed by the P/E ratio. Suppose you were analyzing a stock with $2 of earnings per share (EPS) that is trading at $20 -- this stock would have a P/E of 10. This means investors are willing to pay a multiple of 10 times the current EPS for the stock.

Sign Up For Term of the Day!

Try Our Stock Simulator!

Test your trading skills!

Related Definitions

  1. Earnings

    The amount of ...
  2. Multiple Compression

    The effect that ...
  3. Price-Earnings Ratio - P/E Ratio

    A valuation ...
  4. Price-Earnings Relative

    A price-earnings ...
  5. Earnings Per Share - EPS

    The portion of a ...
  6. Price/Earnings To Growth - PEG Ratio

    A stock's ...
  7. Forward Price To Earnings - Forward P/E

    A measure of the ...
  8. Forward Price To Earnings - Forward P/E

    A measure of the ...
  9. Metrics

    Parameters or ...
  10. Stock Market Crash Of 1929

    A severe ...

Articles Of Interest

  1. Understanding The P/E Ratio

    Learn what the price/earnings ratio really means and how you should use it to value companies.
  2. How To Use The P/E Ratio And PEG To Tell A Stock's Future

    While the price-to-earnings ratio is commonly used for assessing stock prices, the price/earnings-to-growth ratio offers forecasting advantages that investors need to know.
  3. Viewing The Market As Organized Chaos

    Find out how a cat and a ladybug prove markets are both random and efficient.
  4. Equity Valuation In Good Times And Bad

    Learn how to filter out the noise of the market place in order to find a solid way of determing a company's value.
  5. Build A Model Portfolio With Style Investing

    This sophisticated approach will add flair to your returns.
  6. How To Find P/E And PEG Ratios

    If these numbers have you in the dark, these easy calculations should help light the way.
  7. Carl Icahn's Investing Strategy

    Buying up failing investments and turning them around helped to create the "Icahn lift" phenomenon.
  8. Digging Into Book Value

    This calculation will serve up your portion of the shareholder pie.
  9. DCF Valuation: The Stock Market Sanity Check

    Calculate whether the market is paying too much for a particular stock.
  10. The 3 Most Timeless Investment Principles

    Benjamin Graham pioneered cutting edge concepts that propelled other top investors to fame.

comments powered by Disqus
Recommended
Loading, please wait...
Trading Center