24 June 2022 3:17

Calculate price to earning and price to sale value for given dataset

How price to earnings is calculated?

The P/E ratio is calculated by dividing the market value price per share by the company’s earnings per share. Earnings per share (EPS) is the amount of a company’s profit allocated to each outstanding share of a company’s common stock, serving as an indicator of the company’s financial health.

How is PS ratio calculated?

The price-to-sales ratio (Price/Sales or P/S) is calculated by taking a company’s market capitalization (the number of outstanding shares multiplied by the share price) and divide it by the company’s total sales or revenue over the past 12 months. 1 The lower the P/S ratio, the more attractive the investment.

How is Pb ratio calculated?

The price-to-book ratio (P/B) is calculated by dividing a company’s market capitalization by its book value of equity as of the latest reporting period. Alternatively, the P/B ratio can be calculated by dividing the latest closing share price of the company by its most recent book value per share.

What is the EPS formula?

Earnings per share is calculated by dividing the company’s total earnings by the total number of shares outstanding. The formula is simple: EPS = Total Earnings / Outstanding Shares. Total earnings is the same as net income on the income statement. It is also referred to as profit.

How do you calculate PE ratio in Excel?

Price to Earnings Ratio = (Market Price of Share) / (Earnings per Share)

  1. Price to Earnings Ratio = (Market Price of Share) / (Earnings per Share)
  2. PE = 165.48/11.91.
  3. PE = 13.89x.


What is a PE ratio calculator?

Price/earnings ratio calculator is a tool that helps you calculate the price/earnings ratio (P/E ratio in short) – an indicator that measures the attractiveness of shares.

What is PE and PS?

Market participants frequently talks about Price earnings ratio famously referred as “PE ratio”. However, there are times when Price to sales ratio known as “PS ratio” becomes more important and relevant.

How do you calculate forward price-to-sales ratio?

Forward Price to Sales is calculated as the current stock price over the expected sales per share of the next period. If a stock is 600 dollars, the last reporting period’s sales per share was 50, and the forward estimate sales was 100, the forward P/S would be 6 (600/100).

What is the best P S ratio?

While the ideal ratio depends on the company and industry, the P/S ratio is typically good when the value falls between one and two. A price-to-sales ratio with a value less than one is better.

How do I calculate EPS in Excel?

After collecting the necessary data, input the net income, preferred dividends and number of common shares outstanding into three adjacent cells, say B3 through B5. In cell B6, input the formula “=B3-B4” to subtract preferred dividends from net income. In cell B7, input the formula “=B6/B5” to render the EPS ratio.

How do you find the EPS on an income statement?

At the bottom of an income statement, you see two numbers:

  1. The basic earnings per share is a calculation based on the number of shares outstanding at the time the income statement is developed.
  2. The diluted earnings per share includes other potential shares that may eventually be outstanding.


How do you calculate change in EPS?

A change in EPS is calculated by finding the incremental change in EPS and dividing it by the EPS in the prior period.

How are P E multiples used in valuation?

A P/E Multiple, also known as the Price-to-Earnings ratio, indicates the multiple of earnings investors are willing to pay for one share of a company. To determine if a company is “expensive” it is far more useful to compare P/E ratios (say 15x vs 20x) than the absolute stock price ($5/share vs $5,000/share).

What is P E and P B?

P/E ratio is a ratio of a company’s stock price to its Earnings Per Share (EPS). While the P/B ratio is the ratio of the company’s market capitalization to its book value.