Low price/earnings (P/E) ratios indicate high investor confidence.

Name: Low price/earnings (P/E) ratios indicate high investor confidence.
Brand: Quizplus
Rating: 4.9 (54 reviews)

Question

Quizplus · Accepted Answer

Low P/E ratios usually indicate that investors have lower confidence in a company's future earnings potential, which can lead to a lower stock price. High P/E ratios, on the other hand, generally indicate that investors have higher confidence in a company's ability to deliver strong earnings growth in the future.

Low Price/earnings (P/E) Ratios Indicate High Investor Confidence