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QuestionsCategory: Valuation QuadrantTo use PE Ratio- historical or PE ratio- Adjusted?
Zed asked 4 years ago

For PE ratio, do I use historical PE or adjusted PE when analysing a company’s performance?
May I know what is the impact for using different types of PE ratios?
Please delete my previous 2 posts which I accidentally clicked. Sorry for the inconvenience. 

1 Answers
Victor Chng answered 4 years ago

Hi Zed,
it depend on the company situation also. For instance, on normal case you should be using the trailing PE but if the company latest earning are being affected by temporary issue than it does not reflect the true value of the company. Hence, in this case historical PE is better to be use.