Forward PE Ratio

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Definition

The Forward Price to Earnings (PE) Ratio is similar to the price to earnings ratio. While a regular P/E ratio is a current stock price over it's earnings per share, a forward P/E ratio is a current stock's price over its "predicted" earnings per share. Forward P/E ratios less than the current P/E indicates expected increased earnings. Keep in mind, analyst estimates are not set in stone, and can often be wrong.

Forward PE Ratios can highlight some sentiment of a stock. If the forward P/E ratio is higher than the current P/E ratio, it indicates decreased expected earnings.

Formula

Forward PE is calculated by as current stock price over the predicted next annual earnings period.

For instance, if the stock price for Apple is 600 dollars and the predicted EPS was 45, the predicted forward P/E would be 13.3.

Note : We do not display negative P/E ratios.

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