Trailing Price-To-Earnings (P/E)

Trailing Price-To-Earnings (P/E)

The sum of a company's price-to-earnings, calculated by taking the current stock price and dividing by the trailing EPS (earnings per share), for the past 12 months. This measure differs from "forward P/E" which uses earnings estimates for the next four quarters.

Notes:

This is the most commonly used P/E measure because it is based on actual earnings and are therefore the most accurate. However, stock prices are constantly moving while earnings remain fixed and thus, forward P/E can sometimes be more relevant to investors when evaluating a company.

See also: Earnings Estimate, Earnings Per Share - EPS, Forward Price-To-Earnings, Price/Earnings To Growth - PEG Ratio, Price/Earnings To Growth and Dividend Yield - PEGY Ratio, Price-Earnings Ratio - P/E Ratio, Trailing EPS