S&P 500   5,086.46 (+0.33%)
DOW   38,919.42 (-0.08%)
QQQ   438.22 (+0.68%)
AAPL   179.97 (-0.80%)
MSFT   409.22 (+0.37%)
META   487.90 (+0.80%)
GOOGL   137.05 (+0.49%)
AMZN   175.02 (+1.07%)
TSLA   200.99 (-0.52%)
NVDA   792.02 (+1.98%)
NIO   5.69 (+4.79%)
AMD   189.47 (+7.32%)
BABA   74.22 (-0.50%)
T   17.01 (+0.29%)
F   12.42 (+0.98%)
MU   90.00 (+0.32%)
CGC   3.30 (-1.79%)
GE   155.88 (+0.17%)
DIS   111.15 (+0.32%)
AMC   4.30 (-13.83%)
PFE   26.84 (-0.74%)
PYPL   60.44 (+0.32%)
XOM   104.49 (+0.16%)
S&P 500   5,086.46 (+0.33%)
DOW   38,919.42 (-0.08%)
QQQ   438.22 (+0.68%)
AAPL   179.97 (-0.80%)
MSFT   409.22 (+0.37%)
META   487.90 (+0.80%)
GOOGL   137.05 (+0.49%)
AMZN   175.02 (+1.07%)
TSLA   200.99 (-0.52%)
NVDA   792.02 (+1.98%)
NIO   5.69 (+4.79%)
AMD   189.47 (+7.32%)
BABA   74.22 (-0.50%)
T   17.01 (+0.29%)
F   12.42 (+0.98%)
MU   90.00 (+0.32%)
CGC   3.30 (-1.79%)
GE   155.88 (+0.17%)
DIS   111.15 (+0.32%)
AMC   4.30 (-13.83%)
PFE   26.84 (-0.74%)
PYPL   60.44 (+0.32%)
XOM   104.49 (+0.16%)
S&P 500   5,086.46 (+0.33%)
DOW   38,919.42 (-0.08%)
QQQ   438.22 (+0.68%)
AAPL   179.97 (-0.80%)
MSFT   409.22 (+0.37%)
META   487.90 (+0.80%)
GOOGL   137.05 (+0.49%)
AMZN   175.02 (+1.07%)
TSLA   200.99 (-0.52%)
NVDA   792.02 (+1.98%)
NIO   5.69 (+4.79%)
AMD   189.47 (+7.32%)
BABA   74.22 (-0.50%)
T   17.01 (+0.29%)
F   12.42 (+0.98%)
MU   90.00 (+0.32%)
CGC   3.30 (-1.79%)
GE   155.88 (+0.17%)
DIS   111.15 (+0.32%)
AMC   4.30 (-13.83%)
PFE   26.84 (-0.74%)
PYPL   60.44 (+0.32%)
XOM   104.49 (+0.16%)
S&P 500   5,086.46 (+0.33%)
DOW   38,919.42 (-0.08%)
QQQ   438.22 (+0.68%)
AAPL   179.97 (-0.80%)
MSFT   409.22 (+0.37%)
META   487.90 (+0.80%)
GOOGL   137.05 (+0.49%)
AMZN   175.02 (+1.07%)
TSLA   200.99 (-0.52%)
NVDA   792.02 (+1.98%)
NIO   5.69 (+4.79%)
AMD   189.47 (+7.32%)
BABA   74.22 (-0.50%)
T   17.01 (+0.29%)
F   12.42 (+0.98%)
MU   90.00 (+0.32%)
CGC   3.30 (-1.79%)
GE   155.88 (+0.17%)
DIS   111.15 (+0.32%)
AMC   4.30 (-13.83%)
PFE   26.84 (-0.74%)
PYPL   60.44 (+0.32%)
XOM   104.49 (+0.16%)

8 Low P/E Stocks with Room to Grow

 
The price-earnings (P/E) ratio is one of the most significant measurements of a stock. The P/E ratio tells investors how much an investor is willing to pay for every dollar of a company’s earnings. P/E ratios are typically listed along with a company’s stock price. However, if a company’s P/E ratio is not readily available it is easy to determine. The formula for calculating a stock’s P/E ratio is the price of a share divided by the company’s earnings per share (EPS). A stock with a share price of $40 and that has earned $8 per share over the past 12 months has a P/E ratio of 20. The P/E ratio is significant because it can give investors a clue as to whether a stock is properly valued.

However, knowing a stock’s P/E ratio is only a starting point. Any individual P/E ratio has to be compared to P/E ratios of companies in their sector, or with a similar market cap and perhaps as compared to a market index relative to the stock’s category. During this lengthy bull market, “average” P/E ratios have risen which is making a stock with a low P/E ratio stand out more. But is this bad?

In some cases, a low P/E ratio can indicate that investors are concerned about underlying problems that are affecting the growth potential of the stock. However, companies may have a low P/E ratio because they are in a stable, mature industry with moderate growth potential. Also, stocks that pay a high dividend yield may have a lower P/E ratio because they are returning more of their profit to shareholders. If either of these is the case, then low P/E stocks can be a profitable investment because they generally have a lower price per share and a low ratio means that it will take less time for an investor to recoup their investment. For example, a stock with a P/E ratio of 5 will allow an investor to earn back their investment in five years.

In this presentation, we’ll review the stock of eight companies who have comparatively low P/E ratios but still offer an investor room to make a nice profit.

Click the "Continue to Slide #1" button to view the first company.