<<<If your so smart why didn't you give an answer rather than a high and mighty comment? The P/E is not really as important as many make it out to be anyway. Most companies with growth rates like NTDOY.pk have a P/E higher than 100.
It's spelled "you're" and I actually posted a topic titled "Investor Relations" so people can actually follow a link and do the homework. You say the P/E isn't that important because of the growth rate. Um, how do you know the growth rate if you don't even know the P/E? I am holding on to my NTDOY shares. I just think you would be better off doing a little bit of DD before hyping up the stock.
Companies are measured on growth, and P/E measures how much they currently cost. PEG is basically P/E divided by growth rate. For example, if you take the current P/E, and divide it by next year's estimated growth you'll get a ratio.
Anything over 2 is generally over valued, anything under 1 is usually a screaming steal. So a P/E of 30, with estimated growth of 15% is a PEG of 2.0. Anyhow that's just what Cramer says.
The numbers to keep in mind aren't the past numbers, its the ones coming up since Wall Street loves growth.