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Price-to-Earnings (P/E) Ratio

What it is

P/E = price per share / earnings per share. It tells you how much the market is paying today for a dollar of current earnings.

How to read it

  • A higher P/E means investors expect more growth.
  • A low P/E can signal a bargain — or a business in decline.
  • P/E is most useful when compared with the company's history and its sector peers.

Limitations

Earnings can be manipulated by accounting choices, one-off gains, and buybacks. P/E says nothing about debt. Always pair it with cash flow metrics.

How Cowry uses it

P/E is shown for context on the security analysis page. The intrinsic value engines (DCF, ROE) do the heavy valuation lifting; P/E sits alongside as a sanity check.

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