New and easily intimidated person to stocks and been enjoying the research around the subject when I came across PE ratio. I compared several similar companies in the same industry and found that at times it was almost double and thus wanted to find out more about what this really shows.
For instance the company I was looking at had a PE ratio of 7.8 and its competitors had ~13, ~14 and ~12 for their PE ratios even though all of their stocks cost more than the 7.8 company I was looking at. The company PE has been steadily rising for several months to reach its current 7.8 PE ratio, which I believe is a bad sign as it implies it will take longer and longer to receive a return on the amount invested.
Of course by no stretch do I really know what I'm saying, I just had some time and wanted to educate myself more around the always scary topic of stocks.
Appreciate any help!
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