Can some one tell me how I can see a stock is good to buy only lookig at PE and Earning Per share..?

Question

Can some one tell me how I can see a stock is good to buy only lookig at PE and Earning Per share..?

Answer 1

You can't. That's not enough information.

Answer 2

IMHO, P/E ratios are a non-factor. Some stock with low P/E's drop like a stone and some with high P/E's fly to the moon. Look at Amazon (AMZN) in the first quarter of '99. It had yet to report earnings and therefore had NO P/E ratio , but it was a $330.00 stock. It's at best, a small bit of information in the big picture.

Remember, all fundamental data is nothing more than a snapshot of where the company was in the PAST, and is also subject to manipulation and faulty accounting practices (remember Enron and Global Crossing).

Answer 3

Hi..

Don't let anyone fool you..

PE and earnings per share mean nothing.

Companies come and go..

Stocks are bought purely on emotion.
Buy when others are buying and sell
before they do.

This is the real secret to becoming
a rich trader..people who hold a
portfolio are increasing their risk
of a market fall...can you afford
to lose your money when prices
fall?

If yes you can have a portfolio too.

There is a lot of misinformation out
there because people collect management
fees from looking after your portfolio.

Answer 4

p/e is a raitio at what the stock is trading at. e/p is what they pay out. the first is usually a valuation term. depending on your situation i like p/e's around 10-14 times any higher than that i would wait for a pull back. and well the e/p is pretty simple they pay you for being a shareholder and sometimes the p/e can high. nowadays there is fewer stocks to get into at these levels, the normal herd has already gone into the stock and drove the valuations up. so do your own DD and good luck.

Answer 5

Kmart had a high (for Kmart) EPS a couple of years ago, because they were making money off selling the land under their stores and not because more people were buying their products. Just looking at the PE, people would think Kmart was growing, when in fact it was dieing.

Answer 6

PE & EPS are only historical data points. What does the future look like for the company? Is it growing? What is its compeition doing? You need to dig much deeper to make a decision.