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You can learn more about the standards we follow in producing accurate, unbiased content in oureditorial policy. The PEG ratio enhances the P/E ratio by adding expected earnings growth into the calculation. Maintaining independence and editorial freedom is essential to our mission of empowering investor success. We provide a platform for our authors to report on investments fairly, accurately, and from the investor’s point of view.
- These returns cover a period from January 1, 1988 through February 6, 2023.
- The price-to-earnings (P/E) ratio is arguably the most common financial ratio used to value a stock.
- A stock’s beta measures how closely tied its price movements have been to the performance of the overall market.
- Additionally, the automotive segment is also comprised of services and other, which includes non-warranty after-sales vehicle…
- Restricted stock typically is that issued to company insiders with limits on when it may be traded.Dividend YieldA company’s dividend expressed as a percentage of its current stock price.
- The lower the metric, the less they have to pay per dollar of earnings.
This page lists companies that have the lowest price-to-earnings ratios , which is a common financial ratio used for valuing a stock. A stock’s PE ratio is calculated by taking its share price and divided by its annual earnings per share. A higher PE ratio means that investors are paying more for each unit of net income, making it more expensive to purchase than a stock with a lower P/E ratio. Some investors often search for stocks with relatively low P/E ratios as a means for identifying the best value stocks that the market has largely passed over. At the center of everything we do is a strong commitment to independent research and sharing its profitable discoveries with investors.
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Our in-house research team and on-site financial experts work together to create content that’s accurate, impartial, and up to date. We fact-check every single statistic, quote and fact using trusted primary resources to make sure the information we provide is correct. You can learn more about GOBankingRates’ processes and standards price earning ratio tesla in our editorial policy. Tesla stock is reversing deeper and deeper into the mud slide as investors contemplate back-to-back recalls and a distracted CEO. Tesla’s earnings beat has shown that despite rising electricity prices and lowered demand – EVs are still in. The EV company’s shares rallied despite warnings from regulators.
We’d like to share more about how we work and what drives our day-to-day business. CompareTSLA’s historical performanceagainst its industry peers and the overall market. Forward P/E gives some indication of how cheap or expensive a stock is compared with consensus earnings estimates. Tech stocks such as Apple, Nvidia, Block, and Lattice Semiconductor are fueling the growth stock rally in 2023. These top-rated funds make excellent long-term investments in 2023 and beyond.
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Because the PE Ratio measures how long it takes to earn back the price you pay, the PE Ratio can be applied to the stocks across different industries. That is why it is the one of the most important and widely used indicators for the valuation of stocks. You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating indiv idual securities.
As a broad rule of thumb, some investors feel that a PEG ratio below one is desirable. Price/sales represents the amount an investor is willing to pay for a dollar generated from a particular company’s sales or revenues. We are working on updating this web app to fully enable Quantitative Ratios. All other current web features including annual reports, price sensitive announcements, dividends and earnings transcripts are free to use here on our web app. Real-time analyst ratings, insider transactions, earnings data, and more.
Tesla Sets a Delivery Record. What Wall Street Thinks.
In addition, the metric can remain negative for long periods should a company that has more debt than assets. Value investors, who are always looking forbargainsin the stock market, will search for stocks that have a low P/E ratio. The lower the metric, the less they have to pay per dollar of earnings.
The Company’s automotive segment includes the design, development, manufacturing, sales, and leasing of electric vehicles as well as sales of automotive regulatory credits. Additionally, the automotive segment is also comprised of services and other, which includes non-warranty after-sales vehicle… The company’s flagship Model 3 is the best-selling EV model in the United States. The firm’s three-pronged business model approach of direct sales, servicing, and charging its EVs sets it apart from other carmakers. Tesla, which is touted as the clean energy revolutionary automaker, is much more than just a car manufacturer.
What is the price/earnings (P/E) ratio?
The PE Ratio can be viewed as the number of years it takes for the company to earn back the price you pay for the stock. For example, if a company earns $2 a share per year, and the stock is traded at $30, the PE Ratio is 15. Therefore it takes 15 years for the company to earn back the $30 you paid for its stock, assuming the earnings stays constant over the next 15 years. In the calculation of PE Ratio, the earnings per share used are the earnings per share over the past 12 months.
- As a shareholder, you want the company to earn back the price you pay as soon as possible.
- The increase is due to our improved long-term outlook for the company’s free cash flow generation.
- Therefore it takes 15 years for the company to earn back the $30 you paid for its stock, assuming the earnings stays constant over the next 15 years.
- The P/E ratio is a metric used for comparison, so a particular company’s P/E ratio doesn’t tell you much unless you compare it to its historical ratios or the ratios of competing companies.
- If you’re going to understand options, you’ve got to know what strike prices are and how they work.
A company with a low P/E ratio and no other outstanding qualities might be a bad investment if investors perceive a lack of growth potential. Tesla has a negative price-to-earnings ratio because it has reported significant losses in the last 10 years. The PE ratio, which divides a company’s market value by its projected earnings, is a crucial valuation measure that investors and analysts use to compare a stock price with its actual earnings. Tesla’s price/earnings ratio of 57.31 exceeds the industry average for motor vehicles and motor vehicle equipment stocks listed on the NASDAQ. Tesla’s mission is to accelerate the world’s transition to sustainable energy. In addition, with the opening of the Gigafactory and the acquisition of SolarCity, Tesla now offers a full suite of energy products that incorporates solar, storage, and grid services.
Tesla, Inc
Basic Earnings Per Share Basic earnings per share is a simplified valuation of the amount of a company’s… The up/down ratio is calculated by dividing the value of uptick trades by the value of downtick trades. Net money flow is the value of uptick trades minus the value of downtick trades. It could be good if similar companies have higher ratios and investors believe the share price is likely to increase. Some companies might have high P/E ratios because they’re reinvesting all of their profits internally to become bigger, better companies. They might look expensive based solely on their earnings ratios, but if their lack of profits means they’re growing rapidly, they’re probably still going to be a strong investment in the long run.
Stalwart is a description of companies that have large capitalizations and provide investors with slow but steady and dependable growth prospects. The dividend payout ratio is the measure of dividends paid out to shareholders relative to the company’s net income. A negative PEG can result from either negative earnings , or a negative estimated growth rate. Shares slightly undervalued as Tesla’s ability to scale should drive higher long-term free cash flow generation. The beta is 2.07, so Tesla’s price volatility has been higher than the market average.