ut fair value, and therefore whether it is more likely appreciate or depreciatThis ratio represents how much the stock costs versus how much money the company is making. Because you know much investors are willing to pay for a stock based on its earnings, you can learn how much growth people expect from this stock. Effectively it tells you if the stock is cheap, too expensive, or just about fair value, and therefore whether it is more likely appreciate or depreciateny is making. Because you know much investors are willing to pay for a stock based on its earnings, you can learn how much growth people expect from this stock. Effectively it tells you if the stock is cheap, too expensive, or just about fair value, and therefore whether it is more likely appreciate or depreciatased on its earnings, you can learn how much growth people expect from this stock. Effectively it tells you if the stock is cheap, too expensive, or just about fair value, and therefore whether it is more likely appreciate or depreciatck. Effectively it tells you if the stock is cheap, too expensive, or just about fair value, and therefore whether it is more likely appreciate or depreciatut fair value, and therefore whether it is more likely appreciate or depreciate.

You should generally look for companies with low P/E ratios. During the dot-com bubble, many companies achieved outrageous P/E ratios because people had wild expectations for the success of these companies and purchased their stock willy-nilly. People began to think that P/E ratio was irrelevant, and tha