Discussion of the price-to-earnings ratio. Created by Sal Khan.
Watch the next lesson:
Missed the previous lesson? Watch here:
Finance and capital markets on Khan Academy: Life is full of people who will try to convince you that something is a good or bad idea by spouting technical jargon. Most of them have no idea what they are talking about. Don’t be one of those people or their victims when it comes to stocks. From P/E rations to EV/EBITDA, we’ve got your back!
About Khan Academy: Khan Academy offers practice exercises, instructional videos, and a personalized learning dashboard that empower learners to study at their own pace in and outside of the classroom. We tackle math, science, computer programming, history, art history, economics, and more. Our math missions guide learners from kindergarten to calculus using state-of-the-art, adaptive technology that identifies strengths and learning gaps. We’ve also partnered with institutions like NASA, The Museum of Modern Art, The California Academy of Sciences, and MIT to offer specialized content.
For free. For everyone. Forever. #YouCanLearnAnything
Subscribe to Khan Academy’s Finance and Capital Markets channel:
Subscribe to Khan Academy:
Table of Contents
Images related to the topic c squared financial

P/E discussion | Stocks and bonds | Finance & Capital Markets | Khan Academy
Search related to the topic P/E discussion | Stocks and bonds | Finance & Capital Markets | Khan Academy
#discussion #Stocks #bonds #Finance #amp #Capital #Markets #Khan #Academy
P/E discussion | Stocks and bonds | Finance & Capital Markets | Khan Academy
c squared financial
See all the latest ways to make money online: See more here
See all the latest ways to make money online: See more here
Mr. Khan, I used to watch your videos when I was studying at university, mostly science and math (2009-2013). Now I have returned for finance + stock market information (2021). Thanks for all the content!
11 years later and nobody else can explain this stuff better than Khan ! Love the content. Love Khan academy!!
"Who in their right mind would buy a stock with a 100 P/E ratio???"
2021 TSLA:
"Pathetic…"
Lol Watching this in 2021, its so weird hearing references to the Great Recession as if its a current thing.
Where are all the Tesla owners? 😀
nobody is watching this in this crazy market?hummmm
man this is cool
Excellent video. Thanks!!
Really enjoying the videos, Do you have a video on Growth ratio of Equity/EPS/ and Sale?
I think company C is an unlikely case. With increasing earning, price/share will also go up because people want to buy it, then P/E will also go up too. Like you said, market will not allow free money. CMIIW
Sir i just discovered ur lectures… I think i made the biggest discovery of the year…. I m in love with ur lectures…… Sir wonderful job done
I can't see the video, any problem??
howdy, how do you quantify the the P/E if the EPS is negative? I understand how to do the math but what the hell do i do with a negative P/E ratio?
Hi, how does leverage impact PE ratios (presuming in the same industry, same growth rates etc)?
That quality tho
thank you, so much easier listening to someone explain than just reading it
Thanks Khan! I get it now… 😉
hi, what is a negative p/e?
HI MR.KHAN..CAN YOU TELL ME WHICH SOFTWARE YOU USE TO RECORD THIS CLASS
Thank you.
I am very new to the stock market.
My biggest concern is Earnings Per Share?
if I were to buy a share of any company and for example the EPS is 5 dollars.
is that the only thing I get or is it 5 dollars per Hour or Day. aslo if I decide to hold on to the share and forget about it for a week and during that week it goes up or down. will I gain more money or owe money in the process.
awesome video! i have a similar video about Price to Earnings, it'd be great if you can check out my channel!
the market value of that share can safely be decided by the MFRY or the Graham Number or the Price to Tangible Book Value (all the same).
370% consistently? trading what cocaine?
@qzowwgp
I've hit about 370% gains consistently. Get the right strategy and everything falls into place. My system always has consistent results. Watch this
==> bit.ly/NsYahX?=kkopbq
reupload this in 720p 😀
hi…won't the price of $100 change over different periods…i believe its the market price….so accordingly the p/e ratio should also vary…isn't it so
I really liked this. I never quite got what P/E was or how to use it when considering a company's potential price!
Question: Let's say for 2012, the P/E is 6.25 (using the example in the lesson)…how can I use that number to evaluate the market value of that share in 2012?
Good definations to P/E. simple and logic tips.thanks for sharing,Merry Christmas.
No usually when you calculate Earnings Per Share, You subtract the dividends from the Net Income divided by the shares outstanding. So essentially the EPS comes after taking out the dividends paid.
Think of it this way, the dividends paid to shareholders are not counted in the EPS. Although I could be wrong as what i'm talking about is preferred dividends.
Thanks for the very interesting and informative video that really explains P/E Ratios in an easily digestable format.
1st everything 5/5