A P/E ratio is a metric that shows the relationship between a company's stock price and it's earnings per share. It is calculated by dividing the company's current stock price by it's earnings per share. It is an indication of how much investors are willing to pay for every dollar of earnings. In terms of understanding the ratio, a high ratio implies that investors are willing to pay more for every dollar of earnings. It could also imply that the company is overvalued. Gotrade shows the company's P/E ratio on the Stock screen in the app and is based on the last close price divided by the company's total earnings per share for the last 12 months.
Written by ReginaUpdated over a week ago