posted by .

My three criterion are now, if the share is blue-chip or not, the companies PE and its comparison to the S&P/ASX200.

Regarding the companies I have compared it to a rival companies PE, I said that it is good that its PE is higher than the other company but it is still a bad reflection on the company as the PE is only 0.09. (Would that be 9cents?)

Is that correct?

  • Economics -

    Where did you find a PE of 0.09? Which company? I've never seen such a low PE.

  • Economics -

    Qantas Airways on the ASX

    My working out is below:
    Qantas Price Earnings Ratio =
    (Market Value per share)/(Earnings per share (EPS))
    2.08/(Earnings per share (EPS))
    Qantas EPS =
    (Company net income-dividends)/(Number of shares available)
    Qantas Price Earnings Ratio =

  • Economics -

    That came out badly


    PE = Market value per share/EPS
    EPS = net income-dividends/no of shares available
    EPS = 417000000-0/19000000
    EPS = 21.94
    PE = 2.08/21.94
    PE = 0.09

  • Economics -

    I don't know what you did, but the P/E ratio is about 16 for Qantas. (That's within the range of most stocks.)

    Most financial sites show P/E.
    Price: 2.08
    EPS: 0.13

    2.08/0.13 = 16;_ylt=AuuHd2GrepknzNvwLtScYYTxVax_;_ylu=X3oDMTFiMDA2NWVkBHBvcwMxMgRzZWMDeWZpU3ltYm9sTG9va3VwUmVzdWx0cwRzbGsDcWFuYXg-?s=QAN.AX

  • Economics -

    High P/E's (30 +) usually means that the price of the stock is pretty high. Investors believe that the stock's price will go a lot higher.

    Some industries (utilities) tend to have P/E's under 10, but it's unusual for other companies to have such low PEs.

  • Economics -

    Thank-you for all your help so far.

    How did you find the EPS? I think I messed up there..

  • Economics -

    Oh, I see, you got it off the website. I'm just wondering how I got the EPS so wrong.

  • Economics -

    I got it from the website, but I also divided the latest price by the year's earnings per share. That information is also on the website.

    You're welcome.

  • Economics -

    Thank-you for all your help XD

  • Economics -

    You're very welcome.

Respond to this Question

First Name
School Subject
Your Answer

Similar Questions

  1. companies

    what are some resources companies use? Resources companies use for what?
  2. Economics

    What are stocks called in the largest and strongest companies?
  3. Accounting

    Best Answer - Chosen by Asker PE ratios are on starting place -- how is the price of the stock compared to its earnings?
  4. economics

    name two competitor companies that are U.S. GAAP publicly traded companies
  5. Economics REALLY URGENT!!!!!

    Hi my assignment is due like TODAY. I need three simple criterion to evaluate whether it is good to buy shares in a company. So far I have the profability of shares, the potential for a share to be blue-chip but I am lacking a third. …
  6. Economics/Business

    Our large companies seem to be largely run by hired managers who work for salaries and who are not owner-entrepreneurs. How then do we get the profit motive into large companies?
  7. Statistics

    It is said that healthy and happy workers are efficient and productive. A company that manufactures exercising machines wanted to know the percentage of large companies that provided on-site health club facilities. A sample of 240 …
  8. Civics

    Which best describes how patent law encourages market competition?
  9. CAPM

    choose two other companies,look up their beta and report the names of these companies and their betas. suppose you invest one third of your money in each of the stocks of these companies. what will the beta portfolio be?
  10. investment

    dividend of $2.25 a share. In addition, the future annual rate of growth in dividends for each of the three companies has been estimated as follows: Buggies-Are-Us Steady Freddie, Inc. Gang Buster Group g 0% g 6% Year 1 $2.53 (i.e., …

More Similar Questions