The Price To Earnings Ratio Explained

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The price to earnings ratio is one of the most important ratios in investing. Find out how it is calculated, how it can be used and what it tells investors about a particular stock.


In This Series

  1. What Are Stocks?

    Stocks are one of the most popular financial instruments in the world, but what does a stock actually represent? Find out how and why stocks are created, and what buying a stock means for investors.
  2. Return On Equity (ROE)

    Return on equity is one of the basic metrics used to evaluate a company's stock. Find out what it can tell you about a stock and learn how to calculate it here.
  3. An Introduction To The Balance Sheet

    The balance sheet is a basic accounting tool used by individuals, business owners and even large corporations to track net worth. Discover its main components and how they work together.
  4. What Is A Dividend?

    Income investors love them and growth investors rarely expect them, but just what are dividends? Learn the story behind these payouts and why they are (or aren't) offered to investors.
  5. Fat Cat CEOs

    A CEO can have a huge impact on a company's bottom line. Good CEOs can lift up a company through their leadership and management, while some CEOs do just the opposite. Learn about the fat cats, and how their hefty compensation can drag a company down.
  6. How To Calculate Return On Investment (ROI)

    Return on investment allows an investor to evaluate the performance of an investment and compare it to others in his or her portfolio. Find out how to calculate ROI and how to use to your advantage.

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