A study by Travlos and Cornett shows a statistically significant negative correlation between abnormal returns to shareholders and the P/E ratio of the ﬁrm relative to the industry.

Question

Quizplus · Accepted Answer

The study by Travlos and Cornett found that firms with lower P/E ratios relative to their industry tend to have higher abnormal returns, indicating a negative correlation.

A Study by Travlos and Cornett Shows a Statistically Significant