STOCK ANALYSIS BASED ON P/E RATIO - AN EMPIRICAL ANALYSIS WITH RESPECT TO BSE SENSEX

Abstract

The P/E ratio incorporates certain fundamentals of a company like future growth and risk. A P/E ratio indicates how much price an investor is willing to pay for 1 rupee of its earnings. P/E of 18.50 indicates that investors are valuing the stock at 18.50 times of its earnings. P/E Ratio can be used as an important measure to evaluate the stock’s performance.