6. - Deepstash
6.

6.

The P/E ratio is only useful when a company is fully optimized for profits (stage 4)

It's most deceiving in stages 3 & 5

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ashish7

Dreamer โ˜€๏ธ

I've been investing for 18+ years I've made TONS of mistakes along the way here are 10 critical investing lessons I wish I could teach my younger self:

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Some Famous Numbers

THE PRICE/EARNINGS RATIO

Weโ€™ve gone on about this already, but hereโ€™s a useful refinement: The p/e ratio of any company thatโ€™s fairly priced will equal its growth rate.

Iโ€™m talking about growth rate of earnings here. How do you find that out? Ask your broker whatโ€™s the growth rate, a...

What's a good P/E ratio to buy a stock at?

What's a good P/E ratio to buy a stock at?

Unfortunately, there's no P/E ratio set in stone that makes a stock a buy if it's below, or a sell if it's above.

Oftenย value investorsย andย growth investorsย will look for different things in a P/E ratio.ย 

  • Value Investors - the lower the P/E ratio the better.
  • Growth Inves...

If the p/e of Coca-Cola is 15, youโ€™d expect the company to be growing at about 15 percent a year, etc.

But if the p/e ratio is less than the growth rate, you may have found yourself a bargain. A company, say, with a growth rate of 12 percent a year (also known as a โ€œ12-percent growerโ€) and...

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