Investment Insights
February 06 2020

The P/E Ratio: A User's Manual

27 min listen

Steven Bleiberg, Managing Director, Portfolio Manager, TD Epoch

Does a stock’s price and its P/E ratio tell you how much a company is worth? Conventional wisdom says yes, but we think otherwise. In this episode, explore the theory behind the discounted cash flow (DCF) valuation model and the underappreciated role that ROIC plays. Also, learn how we can use what we have learned about the DCF model to deconstruct P/E ratios in the real world. 

 

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