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Earning yield is the quotient of earnings per share (E), divided by the share price (P), giving E/P. [1] It is the reciprocal of the P/E ratio. The earning yield is quoted as a percentage, and therefore allows immediate comparison to prevailing long-term interest rates (e.g. the Fed model ).
Robert Shiller's plot of the S&P composite real price–earnings ratio and interest rates (1871–2012), from Irrational Exuberance, 2d ed. [1] In the preface to this edition, Shiller warns that "the stock market has not come down to historical levels: the price–earnings ratio as I define it in this book is still, at this writing [2005], in the mid-20s, far higher than the historical average
Given any ratio, one can take its reciprocal; if the ratio was above 1, the reciprocal will be below 1, and conversely. The reciprocal expresses the same information, but may be more understandable: for instance, the earnings yield can be compared with bond yields, while the P/E ratio cannot be: for example, a P/E ratio of 20 corresponds to an ...
Based on 2024 earnings per share and both stocks' closing prices on Jan. 31, ExxonMobil has a price-to-earnings ratio of just 13.6 compared to 15.3 for Chevron. That's a compelling value ...
AbbVie stock trades at a forward price-to-earnings (P/E) ratio of 14.2, representing a significant discount to the S&P 500's 23.6 multiple. ... Pfizer sports an eye-catching 6.59% yield, though ...
Investing by equal parts in these three dividend stocks produces an average yield of 3%. ... price-to-earnings (P/E) ratio is now back ... of 7% to 9% per year while keeping a payout ratio of 55% ...
The cyclically adjusted price-to-earnings ratio, commonly known as CAPE, [1] Shiller P/E, or P/E 10 ratio, [2] is a stock valuation measure usually applied to the US S&P 500 equity market. It is defined as price divided by the average of ten years of earnings ( moving average ), adjusted for inflation. [ 3 ]
Investors love dividend stocks, especially the high-yield variety, ... With the S&P 500 price-to-earnings ratio at a hefty 27.87, companies must deliver in a big way. Those that don't could very ...