PRICE EARNINGS MULTIPLE Definition

PRICE EARNINGS MULTIPLE: The price-earnings ratio (P/E) is simply the price of a companys share of common stock in the public market divided by its earnings per share. Multiply this multiple by the net income and you will have a value for the business. If the business has no income, there is no valuation. If the common stock in not publicly traded, valuation of the stock is purely subjective. This may not be the best method, but can provide a benchmark valuation.

Learn new Accounting Terms

GIFTS-IN-KIND are non-cash gifts of tangible or intangible property. Tangible property can fall into two distinct categories, and its value is derived from its physical existence: 1. objects, such as equipment, software, automobiles, printed materials, etc.; or, 2. services, such as providing photography services. Intangible personal property is property whose value stems from intangible elements, e.g. patents and copyrights.

DEBT TO TOTAL ASSETS RATIO measures the percentage of assets financed by all terms of debt, includes both current and long term debt.

Suggest a Term