9.05.2011

On evaluating stocks

The 4 Basic Elements Of Stock Value

Excerpt:


  • The Price-to-Book Ratio (P/B)
  • Price-to-Earnings Ratio (P/E)
  • The PEG Ratio
  • Dividend Yield
Comment: The P/B ratio is only significant if the company goes out of business. If you think they are going to go out to business don't invest in it! Other ratios have value. The P/E looks back at earnings ... the PEG looks forward to earnings. A robust website for these ratios is MacroWorld

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