Low P/E stocks are generally associated with
A)mature companies.
B)cyclical companies.
C)young fast-growing companies.
D)defensive companies.

Question

Quizplus · Accepted Answer

Low P/E stocks are generally associated with mature companies. This is because mature companies tend to have stable cash flows, consistent earnings, and established business models, which would lead to lower risks and lower P/E ratios. On the other hand, young fast-growing companies may have higher P/E ratios due to their potential for future growth, while cyclical companies may have volatile earnings, leading to higher P/E ratios. Defensive companies, which are known for their stability and low volatility, may also have lower P/E ratios.

Low P/E Stocks Are Generally Associated with