If two companies have the same earnings but different P/E ratios, what could be a potential reason?
Question
If two companies have the same earnings but different P/E ratios, what could be a potential reason?
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Solution 1
The Price to Earnings (P/E) ratio of a company is determined by its market value per share divided by its earnings per share (EPS). If two companies have the same earnings but different P/E ratios, it could be due to several reasons:
- Market Perception: The market may perceive one company as Knowee AI StudyGPT is a powerful AI-powered study tool designed to help you to solve study prob
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