Price-to-earnings ratio (P/E)
Share price divided by earnings per share: how many dollars investors pay for each dollar of yearly profit. A high P/E usually means investors expect profits to grow.
Simple example
A share costs $60, and the company earned $3 per share last year. The P/E ratio is $60 ÷ $3 = 20: investors pay $20 for each $1 of yearly profit.