price-earnings ratio (also price-to-earnings ratio) (abbr P/E ratio) (also price-earnings multiple abbr P/E multiple) noun [C]

(Accounting )

the relationship between the present market price of shares in a particular company and the earnings per share (= the amount of profit that the company earned in the previous year divided by the number of shares), used to analyse the company's performance over a period of time or compare it with others:

A high price-earnings ratio can mean that a company is growing fast.

Its price-earnings ratio of about 27 is well below some of its competitors.

The shares trade on a price-earnings multiple of 9.

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