Stocks with a price-earnings ratio greater than 20 to 25 are likely to be underpriced.

Name: Stocks with a price-earnings ratio greater than 20 to 25 are likely to be underpriced.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

This statement is false. A price-earnings ratio greater than 20 to 25 typically indicates that the stock is overpriced. A lower price-earnings ratio may indicate that the stock is underpriced, but it's important to consider other factors in addition to the P/E ratio when assessing a stock's value.

Stocks with a Price-Earnings Ratio Greater Than 20 to 25