A high price-earnings ratio indicates that either the stock is

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A high price-earnings ratio indicates that the stock is overvalued and that people are relatively optimistic about the corporation's prospects. This is because the higher price-earnings ratio means investors are willing to pay more for each dollar of earnings, indicating that they expect earnings to grow in the future. However, it is important to note that a high price-earnings ratio alone does not necessarily mean that a stock is overvalued, as other factors such as growth prospects and industry trends should also be considered.

A High Price-Earnings Ratio Indicates That Either the Stock Is