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Multiple

Another term for price/earnings ratio (P/E ratio or PE) - a measure of the value of a company's stock determined by its current share price divided by its current annual earnings per share (EPS).

Notes:

The term multiple is used because the P/E shows how much investors are willing to pay per dollar of earnings. For example, a stock with $2 of EPS that is trading at $20 has a P/E of 10. This means investors are willing to pay 10 times the current EPS for the stock.

See also: Earnings, Earnings Per Share (EPS), Multiple Compression, Price-Earnings Ratio, Price-Earnings Relative

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multiple

1. In stock-index futures, the number multiplied by the futures price to determine the value of the contract. For example, the $500 multiple of the Standard & Poor's Midcap Index is multiplied by the futures price to determine the value of one contract. Thus, a futures price of $230 would yield a contract value of $115,000 ($500 × $230).

2. See price-earnings ratio (P/E ratio).