Price to Earnings Ratio Calculator for Stock Value
Calculate P/E, earnings yield, and a PEG ratio when a positive growth rate is available.
Enter market price, earnings per share, and an optional expected growth rate, then select Calculate.
About the Price to Earnings Ratio Calculator
The price-to-earnings ratio is the most widely quoted equity multiple. It asks how many dollars of price investors pay for one dollar of earnings per share. Earnings yield is the reciprocal, EPS divided by price, shown as a percent. When a positive expected growth rate is supplied, the calculator also reports a PEG ratio: P/E divided by that growth rate as a whole number, so a P/E of 10 and 10 percent growth produce PEG of 1. If growth is zero or omitted, PEG is shown as N/A rather than zero or infinity. Formula: P/E = market price ÷ EPS; earnings yield % = EPS ÷ price × 100; PEG = P/E ÷ growth rate, using the growth percentage as 10 for 10 percent, not 0.10. Price and EPS must be positive. Growth may be zero. Trailing EPS, forward EPS, and adjusted EPS are different denominators; mixing them with a price from another date produces a multiple that will not match a published quote. P/E is not a complete valuation. Losses, one-off gains, share dilution, and accounting choices can all move EPS. High-growth companies often carry higher P/E ratios because PEG tries to scale the multiple by expected growth. PEG itself is crude: it assumes a linear trade-off, ignores payout, risk, and the duration of growth, and uses whatever growth rate you type. A PEG of 1 is a rule of thumb, not a fair-value proof. Use the price to earnings ratio calculator to convert a price target into a multiple, to compare earnings yield with a bond yield, or to see how a lower growth assumption lifts PEG. Keep EPS on a per-share basis that matches the price—diluted EPS with a diluted share count. The output is a screening aid, not a forecast of earnings and not investment advice. Recompute when the price, the reporting period, or the growth assumption changes.
Price-to-earnings examples
P/E, earnings yield, and PEG cases that match the calculator.
| Inputs | Output | Note |
|---|---|---|
| Price $20; EPS $2; growth 10% | P/E 10; earnings yield 10.00%; PEG 1 | PEG uses 10 as the growth divisor, not 0.10. |
| Price $30; EPS $3; growth 5% | P/E 10; earnings yield 10.00%; PEG 2 | The same P/E looks more expensive once growth is halved. |
| Price $20; EPS $2; growth 0% | P/E 10; earnings yield 10.00%; PEG N/A | PEG is omitted when growth is zero. |
How to calculate price-to-earnings ratio
- Enter the market price per share and earnings per share on the same basis.
- Optionally enter an expected growth rate as a percent for the PEG ratio.
- Select Calculate to review P/E, earnings yield, and PEG or N/A.
- Compare the multiple with peers that use the same EPS definition.
Price-to-earnings ratio FAQ
How is PEG calculated?
PEG divides P/E by the expected growth rate entered as a percent figure. Ten percent growth is 10, so a P/E of 20 produces PEG of 2. Growth of zero returns N/A.
Should I use trailing or forward EPS?
Use whichever definition you will compare against. Trailing P/E uses reported EPS; forward P/E uses estimated EPS. Do not mix a trailing denominator with a forward peer set.
What is earnings yield?
Earnings yield is EPS divided by price, expressed as a percent. It is the reciprocal of P/E and is sometimes compared with bond yields, with the usual caveat that earnings are not contractual coupons.
Why can’t EPS be zero or negative?
A conventional P/E is undefined or unhelpful when earnings are not positive. Analyze loss-making companies with other measures rather than forcing a multiple.
Is this investment advice?
No. P/E and PEG are screening arithmetic. Combine them with growth quality, risk, and professional advice before buying or selling shares.