Finance tools
P/E ratio calculator
Use this P/E ratio calculator to divide share price by earnings per share (EPS) —the classic price to earnings multiple. See earnings yield, estimate fair value with a target P/E, or solve for whichever input is missing. Presets and a live formula update as you type; export CSV or PDF when you are done. You enter figures from your broker or SEC filings—we do not look up tickers for you. Not the profit margin tool (earnings ÷ revenue) or the margin of safety tool (price vs your value estimate). For learning only—not investment advice.
What is the price-to-earnings ratio?
The price-to-earnings ratio (P/E or price-earnings ratio) compares share price to earnings per share (EPS). In plain terms: how many dollars the market pays for each dollar of yearly profit per share. Investors use it as a quick read on valuation for a single stock or an index.
Screens usually show trailing P/E from diluted EPS over the last four quarters (TTM) in 10-Q and 10-K filings. You can enter forward EPS instead if you are modeling next year—just treat estimates as more uncertain than reported numbers.
Calculate P/E live
Enter share price and EPS — the multiple and earnings yield update as you type.
Fair value from target P/E
Fair value per share = EPS × your target multiple, with optional premium or discount vs current price.
Solve missing variable
Know any two of price, EPS, and P/E—we fill in the third for spreadsheets, classwork, or quick checks.
CSV/PDF export
Download inputs and results for Excel, Google Sheets, or notes — calculations stay in your browser.
After you size a position, track blended cost with our stock average calculator. For return since purchase, use the rate of return calculator.
P/E ratio formula
The price-earnings ratio formula is one division: market price per share divided by earnings per share. The result is a multiple (read as “15×” = 15 years of current earnings at today’s price, if EPS stayed flat — a teaching shortcut, not a forecast).
Fair-value and solve variants rearrange the same identity. The calculator applies the formulas below in each mode and rounds display values to two decimals.
Price to earnings formula
P/E = Share price ÷ EPSFair value per share = EPS × target P/E
Earnings yield ≈ (1 ÷ P/E) × 100% — the inverse of the multiple, useful vs bond yields.
Example: $25 share price and $1.80 TTM EPS → P/E ≈ 13.89× and earnings yield ≈ 7.2% (1 ÷ 13.89).
P/E ratio calculator example
Tap a preset above the calculator or type the values below. Results round to two decimals, same as the live tool.
| Scenario | Inputs | Result |
|---|---|---|
| Classic P/E | Price $25, EPS $1.80 | P/E ≈ 13.89× · yield ≈ 7.2% |
| High multiple | Price $200, EPS $5 | P/E = 40× · yield = 2.5% |
| Fair value | EPS $5, target P/E 20× | Fair value $100/share |
| Premium vs fair | Fair $100, price $120 | ≈ 20% above fair value |
| Loss-making | Price $10, EPS −$2 | P/E undefined (negative EPS) |
Load Classic example (13.9×), Fair value at 20×, or Loss-making (negative EPS) presets for live results and CSV/PDF export.
How to calculate P/E ratio
To calculate P/E ratio for a stock, divide share price by EPS per share. Use diluted EPS when the filing provides it—it counts shares that could be added through options and similar instruments.
Enter share price and EPS
Use the current market price and TTM diluted EPS per share from your broker, Yahoo Finance, or SEC EDGAR (10-Q/10-K).
Read P/E and earnings yield
Calculate P/E mode shows the multiple and earnings yield as you type — no submit button.
Optional fair value or solve
Fair value mode multiplies EPS by a target P/E. Solve mode finds the missing price, EPS, or P/E when you know the other two.
Where to find EPS for P/E
P/E needs per-share earnings, not whole-company net income. You do not need every line on the balance sheet — start on the income statement in the company’s 10-K (annual) or 10-Q (quarterly) on SEC EDGAR.
1. Pull diluted EPS (TTM). Use diluted EPS for the last four quarters summed, or the TTM figure your data provider shows. Basic EPS ignores dilution from options and convertibles.
2. Match the share price date. Use a current or closing price on the same day you care about — P/E moves whenever price or EPS changes.
3. Enter both in the calculator. Calculate P/E mode divides price ÷ EPS. For forward P/E, substitute your own next-year EPS estimate in the EPS field.
If you only have net income and diluted share count: EPS = net income ÷ diluted shares, then divide price by that EPS. For company size (not P/E), see the market cap calculator.
Trailing vs forward P/E
Trailing P/E uses reported EPS over the last four quarters (TTM). It is backward-looking but grounded in actual filings — good for comparing mature companies with stable earnings.
Forward P/E uses estimated EPS for the next fiscal year. It can look cheaper or pricier than trailing when earnings are expected to rise or fall. Consensus estimates shift after earnings calls and macro shocks.
Enter trailing or forward EPS yourself—we do not pull analyst consensus. Some investors also track PEG (P/E divided by expected earnings growth); you would calculate that outside this tool.
What is a good P/E ratio?
There is no universal “good” P/E. Compare within the same sector, growth rate, and balance-sheet risk. A low P/E can signal value or a value trap (declining earnings). A high P/E can mean growth expectations or overpayment.
For context, the S&P 500 has often traded around mid-teens to low-20s trailing P/E over long stretches—but multiples shift with interest rates, inflation, and the earnings cycle. Treat index history as background, not a trading signal.
| Context | How investors use P/E |
|---|---|
| Same-sector peers | Compare trailing P/E to a median — outliers deserve a story |
| Company’s own 5–10 year range | See if today’s multiple is high vs its history |
| Earnings growth | Faster growth often supports a higher multiple |
| Interest rates / bond yields | Higher yields can pressure equity multiples |
| Loss-making years | P/E undefined — use sales, cash flow, or book value |
Value investors often pair multiples with a margin of safety on intrinsic value rather than buying solely because P/E looks low. The intrinsic value calculator can show an implied P/E at your fair value; use our margin of safety calculator for buy-price cushion.
When P/E breaks down
P/E is undefined when EPS is zero or negative — common for young or turnaround companies. One-time write-downs, tax items, and restructuring can distort a single year’s EPS; read footnotes in the 10-K.
At cyclical earnings peaks, P/E can look artificially low (denominator is high); at troughs it can look deceptively high. Banks and insurers need industry-specific metrics; asset-light software may look expensive on P/E while growing fast.
P/E is an equity multiple. It ignores net debt: two firms with the same P/E can have very different risk if one carries heavy leverage. Enterprise value (market cap ± debt and cash) and ratios like EV/EBITDA complement P/E — we do not compute EV here.
For fuller models, try our intrinsic value calculator, WACC calculator, and market cap calculator. Here you enter price and EPS manually—no auto ticker lookup, sector medians, or built-in PEG.
P/E ratio in Excel and Google Sheets
A P/E ratio calculator in Excel is a single division. Put labels in row 1 and values in row 2 so formulas stay readable — or export CSV from this page and open in Sheets.
| Goal | Cells (example) | Formula |
|---|---|---|
| P/E multiple | A1 = price, A2 = EPS | =A1/A2 |
| Earnings yield % | A1 = price, A2 = EPS | =(A2/A1)*100 |
| Fair value | B1 = EPS, B2 = target P/E | =B1*B2 |
| Premium vs fair | C1 = price, C2 = fair value | =(C1-C2)/C2 |
Format the P/E cell with two decimals and add “×” in a label column if you share the sheet. Always use per-share EPS from filings—see where to find EPS above.
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Frequently asked questions about this P/E ratio calculator
How is the P/E ratio calculated?
Divide share price by earnings per share (EPS): P/E = price ÷ EPS. In this tool, choose Calculate P/E, enter both numbers, and the multiple updates instantly. Example: $25 and $1.80 EPS ≈ 13.89×.
What is a good P/E ratio?
There is no one-size-fits-all answer. Compare the stock to peers in the same industry and to its own history. The S&P 500 has often traded near mid-teens to low-20s trailing P/E over long periods, but your company’s growth and risk matter more than the index alone.
What is a fair price-to-earnings ratio?
“Fair” here means EPS × a target P/E you choose, not a market guarantee. Pick a multiple grounded in sector medians or past trading ranges, then use Fair value mode to see the implied price per share.
Is a P/E of 40 good?
It can be, if earnings are expected to grow fast enough to justify the price. On a mature, slow-growing business, 40× is usually rich. Always read P/E next to growth, margins, and debt—not in isolation.
What did Warren Buffett say about the P/E ratio?
Buffett warns against buying on low P/E alone. He looks for understandable businesses, durable earnings, and a margin of safety on price—not just the cheapest multiple on a screen. Owner earnings and intrinsic value matter more than a single ratio.
What does a negative P/E ratio mean?
It usually means negative EPS (a loss), so price ÷ EPS is not meaningful. Screens may show “N/A.” Use sales, cash flow, or book-value metrics instead; this calculator explains when EPS is zero or below.
What is trailing vs forward P/E?
Trailing P/E uses reported EPS from the last four quarters (TTM). Forward P/E uses an estimate for next year’s EPS. Type either figure into the EPS field—we do not download consensus forecasts.
What is earnings yield?
Earnings yield is EPS ÷ price, the same as 1 ÷ P/E shown as a percent. A 20× P/E equals roughly a 5% earnings yield, which some investors compare to bond yields. It appears below your P/E result here.
How do I calculate P/E in Excel?
With price in A1 and EPS in A2, use =A1/A2. Fair value: =B1*B2 when B1 is EPS and B2 is your target P/E. You can also export CSV from this page and open it in Sheets.
How do you calculate P/E from a balance sheet?
Get diluted EPS from the income statement (or compute net income ÷ diluted shares). P/E is then share price ÷ EPS. The balance sheet helps you judge debt and cash for other ratios, but those lines are not in the basic P/E formula.
Is a high or low P/E ratio better?
Neither is automatically better. A low P/E might flag a bargain or a company in trouble. A high P/E might reflect strong growth expectations or an overheated price. Compare peers, growth, and cash flows before you decide.
How is P/E different from profit margin?
Profit margin is profit divided by revenue (a percentage on the income statement). P/E is share price divided by EPS (a market valuation multiple). Try our profit margin calculator for margin math.
How is P/E different from margin of safety?
P/E is a quick price-to-earnings multiple. Margin of safety measures how far market price sits below your intrinsic value estimate. Fair value from a target P/E is not the same as a Graham-style margin of safety—use our margin of safety calculator for that step.
Can I use this as a stock price to earnings ratio calculator?
Yes. Enter the stock’s current price and TTM diluted EPS (or your own forward EPS). It works for any listed share where you have both inputs. We do not look up symbols or live quotes for you.
Can I find fair value from a P/E ratio?
Yes. Open Fair value mode, enter EPS and a target P/E, and you get fair value per share. Add an optional current price to see whether the stock trades at a premium or discount to that anchor.
What is the P/E ratio formula?
P/E = market price per share ÷ earnings per share, typically trailing twelve-month diluted EPS from SEC filings. Rearranged: fair value ≈ EPS × target P/E; earnings yield ≈ EPS ÷ price.
Is this P/E calculator free?
Yes. Live calculations, presets, and CSV/PDF export are free. No account is required, and your inputs are processed in your browser—they are not sent to our servers.
Does this tool look up live stock prices?
No. Copy price and EPS from your broker, a data terminal, or SEC EDGAR. That keeps the math transparent and avoids relying on a ticker API.
How do I solve for missing price, EPS, or P/E?
Select Solve missing, then fill in any two of share price, EPS, and P/E. The calculator solves for the third field automatically.
Is this investment advice?
No. This page is for learning and scenario math only, not recommendations to buy or sell. For definitions, see Investor.gov on the P/E ratio.
How does P/E relate to intrinsic value?
P/E summarizes price versus one year of earnings. Intrinsic value models future cash flows, growth, and risk. You can compare implied P/E at your fair value using our intrinsic value calculator.
Can I export my P/E calculation?
Yes. Use Export CSV or Export PDF to save inputs, P/E, earnings yield, fair-value fields (if used), and the standard finance disclaimer.