While I don't want to look too hard into P/E ratios to scare me from certain stocks, when looking at ones like AT&T and Verizon I begin to get a little scared to see such high numbers, especially for Verizon. While there is no magic number, what are ratios people tend to look for or close in on to feel safe yet leave some risk for growth?
Sigma_ Wake Forest Fan Member since Jun 2013 46 posts
re: How high is too high for p/e(Posted by Sigma_ on 6/25/13 at 8:46 pm to STB)
Well, I'm no investment whiz, but you could always consider a concept like the PEG ratio to gut-check the PE ratio. It just says higher PE ratios should reflect a forward-looking growth rate in earnings.