PE also tells a different story on different sectors.
PE could be seen as an amount investors are willing to pay for the stock, like you described.
For example if a hyped tech stock has 70 PE, it is pretty high.
But on slow sectors, Consumer staples or mining, PE could indicate how many years it takes to earn invested money back.
70 PE is a disaster In that scenario 👀
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PE also tells a different story on different sectors.
PE could be seen as an amount investors are willing to pay for the stock, like you described.
For example if a hyped tech stock has 70 PE, it is pretty high.
But on slow sectors, Consumer staples or mining, PE could indicate how many years it takes to earn invested money back.
70 PE is a disaster In that scenario 👀