Hi, would like to clarify about the computation of Historical PE. I saw the 2 previous post, however I still have some qns about it.
Firstly, for the first post – https://investmentquadrant.com/question/how-to-calculate-historical-pe-ratio/
If I use only the closing price and EPS when Annual reports are out, won’t I get only 5 PE ratios for 5 years?
Is this enough to have a rough gauge of Average Historical PE?
Let’s say it is not enough and I refer to the second post – https://investmentquadrant.com/question/compute-historical-pe/
You mentioned about using Yahoo Finance to get the historical price data. May I know the frequency that you use, is it monthly, weekly or daily?
After getting the price data, do you divide all the (12 prices or more?) by the EPS for that particular year annual reports?
Also for the EPS, do u make any adjustments (E.g. excluding one-off gain or lost) or you take the EPS value in the annual reports as it is?
Next, for the plotting of the graph I suppose you use excel to show the data? Or is there other software for it?
Last but not least, those 2 posts are 2 to 3 years ago. Is there a less tedious way to obtain Historical PE or a software to show the Historical PE of Singapore Listed Companies and if possible, other countries stock market?
Hi Qi Jie,
As mentioned by Jieren, use daily price and plot out their daily PE ratio. From the daily PE ratio, you can find the average PE.
Yes bloomerg terminal, Factset, Thomson Reuters and CapitalIQ can solved this issue and give you the PE chart in less than 1 min but it will cost you about USD$2000 per month just to generate this chart. My take is that it may seem tedious but when it comes to investing some work have to be done. In the initial part it may take you quite some time to do it but it will get easier as times goes. Now I can collect the PE ratio chart within 15 min.
Thanks JR and Victor for the reply!
So just to cfm, e.g. lets say I will take the EPS of BreadTalk for the FY2014 (did my own adjustments). Next I will go to Yahoo Finance to find the daily price for BreadTalk in year 2014. Now, with the 2 data, I will compute my own PE for year 2014? Is that correct?
Assume I plot my own chart and came up with a data, how many years of historical PE should I use? is 5 years enough and 10 years too much? Or what is a good range?
Hi Qi jie,
If possible take at least 10 years of daily price data.
For instance, you downloaded the daily price chart of breadtalk (BT). For BT, their full year result year end is December. Hence for example, their FY2013 result will only be release in Feb 2014. Hence the price from 1 Mar 2014 to 28 Feb 2015, I will input the FY2013 EPS to compute the PE ratio. This way you will obtain the historical PE ratio chart.
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