Ideas from books, articles & podcasts.
Growth investors often use the P/E ratio as a building block for finding two other metrics: the forward P/E and the PEG ratios.
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It is important to understand that the stock's intrinsic value is not necessarily directly tied to its current market price.
The efficient market hypothesis, a theory that states that all known information is currently priced into a stock. However, this is not always the case.
While using the P/E ratio as a building block is probably the most popular method to value stocks it is far from the only way. Another common technique to valuing stocks is the price/sales ratio. The P/S ratio is determined by dividing a company's market cap -- the total value of all the companie...
Another metric useful for evaluating some types of stocks is the price-to-book ratio.
How to calculate?
A single share of a company represents a small, but real, ownership stake in a corporation.
One stock's percentage of ownership is determined by dividing it by the total number of shares outstanding.
Stock ownership generally entitles the owner to corporate voting rights and to any di...
The go-to metric for nearly all investors when it comes to valuing a stock has to be the P/E ratio. Standing for price-to-earnings, this formula is calculated by dividing the stock price by the earnings per share (EPS). The lower the P/E ratio, the more earnings power investors are buying with ea...
There's more to valuing a stock than just crunching numbers. Investors have to take into careful consideration qualitative factors also, such as a company's economic moat. Moats encompass companies' competitive advantages, such as a network effect, cost advantages, high switching costs, or intang...
Unfortunately, there's no P/E ratio set in stone that makes a stock a buy if it's below, or a sell if it's above.
Often value investors and growth investors will look for different things in a P/E ratio.
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Companies at every stage can learn how to create effective, replicable, and durable product development systems using a few tactics.
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The Heart/Will/Head model defines three types of people and how they view the world around them.
Using this model is valuable for managers to build stronger teams en get the best work out of each member.
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"Well, the first rule is that you can’t really know anything if you just remember isolated facts and try and bang ’em back. If the facts don’t hang together on a latticework of theory, you don’t have them in a usable form."
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