How to calculate Historical PE Ratio? | The Investment Quadrant by The Fifth Person

Questions › Category: Valuation Quadrant › How to calculate Historical PE Ratio?

Thomas asked 6 years ago

Hi,

Just want to ask, if I wanna calculate a company’s historical PE for 5 years back.. I know that I can take the figures in annual reports for the EPS.. but for the price, do i look for the closing prices which is on the company’s Financial Year End date?

For example, a company’s FYE is 30 June of every year. If i wanna calculate its historical PE for year 2010 to 2015, do I use the closing share price as at 30 June 2010 to 2015?

1 Answers

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Victor Chng answered 6 years ago

Hi Thomas,

You are right to take the closing price. When the company FYE end in June their financial report will mostly be out by August hence I will suggest you take the End of August price as a better reference.

Thomas replied 6 years ago

So, it doesn’t matter which FYE..as long as I choose the closing price as at the date where the company announced its Annual Reports or 4th Quarter of Financial Results?

Victor Chng replied 6 years ago

Hi Thomas,

Yes you are right