PRICE/EARNINGS RATIO
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The price/earnings ratio is a tool widely used by investors to evaluate whether a stock is a good current pick. In this tutorial you will learn the following about the price/earnings ratio:

• WHAT IS THE PRICE/EARNINGS RATIO?
• IMPORTANCE OF THE PRICE/EARNINGS RATIO
• EXTERNAL FACTORS THAT INFLUENCE THE PRICE/EARNINGS RATIO
• INTERNAL FACTORS THAT INFLUENCE THE PRICE/EARNINGS RATIO
• SUMMARY OF PRICE/EARNINGS RATIO

Let's begin with the basics.