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#7 Investing 101: How To Think About The PE Ratio?

#7 Investing 101: How To Think About The PE Ratio?

High PE is not always bad and low PE is not always good. So, how should you really think about the PE ratio?

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Oguz Erkan
Nov 13, 2024
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#7 Investing 101: How To Think About The PE Ratio?
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There are magic numbers in every game.

In soccer, it’s three. If a player scores three times in a game, it’s called a hat-trick. Children playing street-soccer gain 1 penalty for every 3 corners.

In basketball it’s 10. If you do 10 points and 10 assists, it’s double-double. If you add 10 rebounds too, it’s a triple-double.

In investing it tends to be 15.

Wh…

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