price-earnings ratio

noun

price-earn·​ings ratio ˈprīs-ˈər-niŋz- How to pronounce price-earnings ratio (audio)
: a measure of the value of a common stock determined as the ratio of its market price to its annual earnings per share and usually expressed as a simple numeral

Examples of price-earnings ratio in a Sentence

Recent Examples on the Web Price-to-Sales Ratio The price-earnings ratio is ineffective at gauging the quality of companies with erratic earnings or no earnings at all. Charles Rotblut, Forbes, 29 Feb. 2024 To give a 10% return at a (better-than-average) price-earnings ratio of 25, Nvidia must earn $200 billion in profit by 2034—twice as much as what Apple and Microsoft make now. Diane Brady, Fortune, 23 Feb. 2024 With a market capitalization of 56.95 billion, the stock is trading at 1.50 times its book value with a price-earnings ratio of 6.29. John Navin, Forbes, 20 Feb. 2024 Additionally, the forward non-GAAP price-earnings ratio is 7.01, which is 27.87% lower than the average over the past five years, indicating that financial market participants remain conservative about Bristol-Myers Squibb's prospects. Gurufocus, Forbes, 29 Nov. 2023 The stock is trading at a 27% discount from its book value, with a price-earnings ratio of 19.88. John Navin, Forbes, 22 Feb. 2023 The company has a score of 41 for the enterprise-value-to-EBITDA ratio, 10 for shareholder yield and 35 for the price-earnings ratio (remember, the lower the score the better for value). Charles Rotblut, Forbes, 27 Jan. 2022 The bank holding company headquartered in Detroit has a market cap of $11.01 billion; its shares were trading around $35.67 on Monday with a price-earnings ratio of 5.13, a price-book ratio of 0.96 and a price-sales ratio of 1.34. Gurufocus, Forbes, 16 Aug. 2022 The company has a shareholder yield of 4.9%, an enterprise-value-to-EBITDA-ratio of 5.2 and a price-earnings ratio of 5.1. Charles Rotblut, Forbes, 10 Nov. 2022

These examples are programmatically compiled from various online sources to illustrate current usage of the word 'price-earnings ratio.' Any opinions expressed in the examples do not represent those of Merriam-Webster or its editors. Send us feedback about these examples.

Word History

First Known Use

1929, in the meaning defined above

Time Traveler
The first known use of price-earnings ratio was in 1929

Dictionary Entries Near price-earnings ratio

Cite this Entry

“Price-earnings ratio.” Merriam-Webster.com Dictionary, Merriam-Webster, https://www.merriam-webster.com/dictionary/price-earnings%20ratio. Accessed 28 Mar. 2024.

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