When calculating, the stock price usually takes the latest closing price, and in EPS, if it is calculated according to the published EPS of the previous year, it is called historical price-earnings ratio; Generally speaking, * * * knowledge estimation is the EPS estimation used to calculate the price-earnings ratio, that is, the average or median estimation obtained by institutions that track the company's performance and collect the predictions of many analysts. What is a reasonable price-earnings ratio, there is no certain standard.
P/E ratio is the ratio of share price to earnings per share. The price-earnings ratio widely discussed in the market usually refers to the static price-earnings ratio, which is usually used as an indicator to compare whether stocks with different prices are overvalued or undervalued. When measuring the quality of a company's stock, the P/E ratio is not always accurate. Generally speaking, if the price-earnings ratio of a company's stock is too high, then the price of this stock is in a bubble and its value is overvalued. When a company grows rapidly and its future performance is very promising, when comparing the investment values of different stocks with P/E ratio, these stocks must belong to the same industry, because the earnings per share of the company are close at this time, so the comparison is effective.