What is the reasonable price-earnings ratio? Usually, a P/E ratio less than 0 means that the company's profit is negative. The price-earnings ratio of 0- 13 means that the value is undervalued, the price-earnings ratio of 14-20 means normal, and the price-earnings ratio of 2 1-28 means that there is a speculative bubble in the stock market, so the price-earnings ratio of 14-20 means overvalued. Next, I will briefly introduce the situation that the price-earnings ratio is too high.

P/E ratio is too high, okay?

To put it bluntly, the price-earnings ratio can be understood as how many years to recover the investment. For example, per share 10 yuan, the profit is 5 yuan, and the P/E ratio is 2, which means that the investment will be recovered in 2 years. Quickly infer whether the company's share price is overvalued or undervalued, for example, the price-earnings ratio is 30, so it can be inferred that the company's share price is too expensive. For example, once the P/E ratio exceeds 50 times, it means that it will take investors more than 50 years to return their capital, which means that the value of the stock is overvalued, so there is no dividend.

The above is the question I sorted out for you about how reasonable the P/E ratio is. I hope it helps you.