http://thecuriousinvestor.com/2006/11/09/reading-a-stock-quote-the-pe-ratio/ A stock market and investing blog for the curious Tue, 08 Dec 2009 07:09:51 +0000 hourly 1 http://wordpress.org/?v=3.0 http://thecuriousinvestor.com/2006/11/09/reading-a-stock-quote-the-pe-ratio/comment-page-1/#comment-73 The Curious Investor » Blog Archive » Fundamental Analysis: Valuation Measures Thu, 08 Feb 2007 06:33:57 +0000 http://thecuriousinvestor.com/2006/11/09/reading-a-stock-quote-the-pe-ratio/#comment-73 [...] We’ve talked about Price to Earnings ratios in the first introduction to reading a stock chart. Price-to-Sales is a measure of the price of the stock divided by the dollar amount of sales/revenues per share outstanding. Price-to-Book is a measure of share price divided by the book value of the company per share. Book value is a computed as total assets minus liabilities which is essentially another measure of what a company is worth from the perspective of someone who already owns the company as opposed to someone who would like to take it over (as is the case with market cap and enterprise value). PEG Ratio is defined as the price to earnings ratio divided by the annual growth rate. This is a pretty primitive ratio designed to help you take growth rate into account, but in my opinion has no real mathematical meaning and you might be better off looking at P/E and growth rate seperately and making your own decisions. I am in the process of trying to devise a better way to combine the two metrics that has more true meaning, and if anyone has any ideas do comment! [...] [...] We’ve talked about Price to Earnings ratios in the first introduction to reading a stock chart. Price-to-Sales is a measure of the price of the stock divided by the dollar amount of sales/revenues per share outstanding. Price-to-Book is a measure of share price divided by the book value of the company per share. Book value is a computed as total assets minus liabilities which is essentially another measure of what a company is worth from the perspective of someone who already owns the company as opposed to someone who would like to take it over (as is the case with market cap and enterprise value). PEG Ratio is defined as the price to earnings ratio divided by the annual growth rate. This is a pretty primitive ratio designed to help you take growth rate into account, but in my opinion has no real mathematical meaning and you might be better off looking at P/E and growth rate seperately and making your own decisions. I am in the process of trying to devise a better way to combine the two metrics that has more true meaning, and if anyone has any ideas do comment! [...]

]]> http://thecuriousinvestor.com/2006/11/09/reading-a-stock-quote-the-pe-ratio/comment-page-1/#comment-12 The Curious Investor » Blog Archive » Reading a Stock Quote: Volume & Price Mon, 13 Nov 2006 22:44:27 +0000 http://thecuriousinvestor.com/2006/11/09/reading-a-stock-quote-the-pe-ratio/#comment-12 [...] Arguably the two most important parts of a stock quote, volume and price should always go hand in hand. Price, while a very interesting number, provides little real information about a stock. As we saw in the P/E ratio post, the price of a stock is really only important relative to other information you can gather on the company or the stock itself. Looking at the daily trading volume of a stock is one method of getting a better prospective on the price or the price change of the stock that day. [...] [...] Arguably the two most important parts of a stock quote, volume and price should always go hand in hand. Price, while a very interesting number, provides little real information about a stock. As we saw in the P/E ratio post, the price of a stock is really only important relative to other information you can gather on the company or the stock itself. Looking at the daily trading volume of a stock is one method of getting a better prospective on the price or the price change of the stock that day. [...]

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