Enter the average share price ($) and the earnings per share ($) into the PE Ratio Calculator. The calculator will evaluate and display the PE Ratio.
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PE Ratio Formula
The following formula is used to calculate the PE Ratio.
PE = SP / EPS
- Where PE is the PE Ratio
- SP is the average share price ($)
- EPS is the earnings per share ($)
How to Calculate PE Ratio?
The following example problems outline how to calculate PE Ratio.
Example Problem #1:
- First, determine the average share price ($).
- The average share price ($) is given as: 500.
- Next, determine the earnings per share ($).
- The earnings per share ($) is provided as: 250.
- Finally, calculate the PE Ratio using the equation above:
PE = SP / EPS
The values given above are inserted into the equation below and the solution is calculated:
PE = 500 / 250 = 2.00
Example Problem #2:
For this problem, the variables required are provided below:
average share price ($) = 600
earnings per share ($) = 300
Test your knowledge using the equation and check your answer with the calculator above.
PE = SP / EPS = ?
