B
Glossary
Price-to-Earnings Ratio
Also: P/E
Important — standard screening
What it measures
Years of current profit you pay per share. A higher number means more years of today's earnings are priced in. Blank if the company loses money.
Formula
Share Price ÷ EPS (last 12 months)Benchmark
S&P 500 avg ~22x
Related metrics
Source
Damodaran, Investment Valuation (2012), ch. 18