trailing P/E

(redirected from Trailing Price to Earnings Ratio)

Trailing P/E

The price of a security per share at the present time divided by the trailing earnings per share over the previous year. It is the most commonly used form of the P/E ratio because it is based on actual, rather than projected, earnings. A trailing P/E ratio is thus the most accurate way to measure a security's valuation, that is, the fair value of a stock in a perfect market.
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trailing P/E

The price-earnings ratio of a firm's common stock calculated as the current stock price divided by the previous year's earnings per share. Compare forward P/E.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.
References in periodicals archive ?
Overall, companies in the S&P 500 financial sector trade at a trailing price to earnings ratio of 14.5 and are up 2.2 percent for the year to date, according to Thomson Reuters data.
Although the DSM Index is trading at a trailing price to earnings ratio of 15X (higher than the GCC and EM), the high dividend payout (3.7 per cent for the index and even higher for some of the banks) will not lose its appeal with investors.