The Price-to-Earnings (P/E) ratio compares a company’s stock price to its earnings per share. Calculate it by dividing the stock price by earnings per share. Use P/E to assess if a stock is overvalued or undervalued, but consider industry norms and combine with other metrics for a comprehensive analysis.
Formula for Success: Price-to-Earnings (P/E) Ratio Read More »
Imagine you’re considering investing in two companies. Company A’s stock is priced at $50, while Company B’s is at $100. Which one is the better deal? At first glance, you might think Company A is cheaper and therefore a better
Earnings Per Share (EPS): A Key Metric for Well-Educated Investors Read More »
The Gordon Growth Model provides a useful framework for valuing dividend-paying stocks. By estimating future dividends, dividend growth, and required investor returns, the model calculates a stock’s intrinsic value for investment analysis.
The Gordon Growth Model: A Simple Approach to Stock Valuation Read More »
