price-earnings ratio

American  

[prahys-ur-ningz ray-shoh, -shee-oh] / ˈpraɪsˈɜr nɪŋz ˌreɪ ʃoʊ, -ʃiˌoʊ /

Also P/E ratio

noun

1. the current price of a share of common stock divided by earnings per share over a 12-month period, often used in stock evaluation. P/E, p/e, PE, P-E, p-e

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price-earnings ratio British  

noun

1. P/E ratio. the ratio of the price of a share on a stock exchange to the earnings per share, used as a measure of a company's future profitability

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Etymology

Origin of price-earnings ratio

First recorded in 1960–65

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Example Sentences

See Examples For:

price-earnings ratio

And you’re better off buying stocks based on their future potential, everything from the company’s price-earnings ratio to its historic and projected revenue growth.

From MarketWatch ● Apr. 20, 2026

With steady earnings and enhanced capital management, Telekom’s shares, trading at 2026 estimated price-earnings ratio of 13.0X and offering an expected 4.7% dividend yield in 2025, could have re-rating potential, he adds.

From The Wall Street Journal ● Nov. 25, 2025

Hasbro also commands a higher price-earnings ratio of 15.2 times next year’s earnings, compared with Mattel’s 11 times estimates.

From Barron's ● Oct. 26, 2025

Goldman Sachs said in a note a recession could cause the S&P 500 index to fall by 19% to 3,150 by the end of 2022, and a sharp contraction in the price-earnings ratio.

From Reuters ● Jul. 18, 2022

Analysts and professional investors look at something called the price-earnings ratio to gauge investors’ willingness to own stocks.

From Seattle Times ● Jun. 23, 2022

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