Investors are willing to pay more for a stock if they expect higher earnings in the future. If investors have seen a positive trend in growth opportunities, the stock's market price will increase and the price-earnings ratio will also increase. This is to be expected and does not mean the stock is overvalued.
Investors are willing to pay more for a stock if they expect higher earnings in the future. If investors have seen a positive trend in growth opportunities, the stock's market price will increase and the price-earnings ratio will also increase. This is to be expected and does not mean the stock is overvalued.
Investors are willing to pay more for a stock if they expect higher earnings in the future. If investors have seen a positive trend in growth opportunities, the stock's market price will increase and the price-earnings ratio will also increase. The fact that this has occurred indicates increased growth opportunities for the company, not a decline in growth opportunities.
Investors are willing to pay more for a stock if they expect higher earnings in the future. If investors have seen a positive trend in growth opportunities, the stock's market price will increase and the price-earnings ratio will also increase. The fact that this has occurred indicates increased growth opportunities for the company, not that inferior investment decisions have been made by management.
|
Based on the price-earnings information, investors would most likely consider Arnold's common stock to