How to Get Historical PE Ratios for Stocks

How to Get Historical PE Ratios for Stocks

Are you interested in learning how to obtain historical PE Ratios for stocks? This valuable information can provide insights into a company's valuation over time, assisting you in making informed investment decisions. In this guide, we'll delve into how to find and interpret these figures, equipping you with the necessary tools to confidently invest in stocks. So, let's explore how to get historical PE Ratios for stocks!

Understanding the PE Ratio and Its Importance

The PE ratio (Price-Earnings Ratio) is a metric used to compare a company's current market stock price with its earnings per share (EPS). It informs investors how much they're paying for each dollar of earnings, serving as an indicator of the stock's value relative to other companies or stocks. Generally, a higher PE ratio suggests that investors are willing to pay more for a company's earnings, while a lower PE ratio indicates less willingness.

For instance, if a stock's current price is $50 and its EPS is $5, then the PE ratio is 10. This means investors are paying $10 for each dollar of earnings. This figure can be compared to other companies or stocks to assess whether it represents good value.

The Value of Analyzing Historical PE Ratios

The historical PE ratio of a stock can be used to determine whether the current market price aligns with the stock's traditional trading patterns. If a company's PE ratio is historically high, it may suggest that investors expect more from the company than it is currently delivering. Conversely, if a stock's historical PE ratio is low, it may indicate that investors are undervaluing the stock.

For example, if a stock is currently trading at a PE ratio of 10, but its historical average is 15, this could suggest that the stock may be undervalued and offer investors good value. However, it could also mean that the stock has underperformed and is less valuable than before. By examining the historical PE ratio of a stock, investors can make better decisions on whether or not to invest in it.

How to Get Historical PE Ratios for Stocks

The most straightforward and efficient way to obtain historical PE ratios for stocks is by using Wisesheets. This powerful tool simplifies the process and provides you with accurate and comprehensive data. Here's how you can use Wisesheets to get this valuable information:

Get the Historical PE for 1 Year

Wisesheets offers a function called WISE that allows you to retrieve a wide range of financial data for a specific company. To get the historical PE ratio, you would use the function in the following format: =WISE("ticker", "PE", "period").

Replace "ticker" with the stock symbol of the company you're interested in and "period" with the specific year or time period you want the PE ratio for. For instance, if you want to get the PE ratio for Apple Inc. (AAPL) for the year 2022, you would use: =WISE("AAPL", "PE ratio", 2022).

Get the Historical PE for 1 Year

Retrieve Data for Multiple Years

Wisesheets allows you to retrieve PE ratios for multiple years at once by using an array of years in the "period" parameter. For example, =WISE("AAPL", "PE ratio ", {2022, 2021, 2020}) would return the PE ratios for Apple for the years 2022, 2021, and 2020.

Historical PE ratio

By following these steps, you can easily access the historical PE ratios for any stock, providing you with valuable insights to inform your investment decisions.

Compare Historical PE Ratios Across Multiple Stocks

Wisesheets also allows you to retrieve historical PE ratios for multiple companies at once, making it easy to compare them in a single view. This can be done using the custom screener feature. Here's how:

PE ratio screener
  1. Prepare a List of Stocks: First, compile a list of the stock tickers for the companies you're interested in comparing in your Excel or Google Sheets spreadsheet.
  2. Navigate to the WISE Screener: Once you have your list of stocks, navigate to the WISE Screener section of the Wisesheets add-on.
  3. Select Your Tickers: Use your mouse to select the list of tickers you want to gather data for. Once selected, click on the 4 square icon to proceed.
  4. Enter Your Parameters: Next, you'll need to enter the parameters for which you'd like to retrieve data. In this case, you would enter "PE" and the specific years or time periods you're interested in. Once you've entered your parameters, click on the 4 square icon again.
  5. Retrieve the Data: After you've selected your tickers and entered your parameters, click on the "Get Data" button. Wisesheets will then generate a screener with the historical PE ratios for all the companies you selected, allowing you to compare them in a single view.

Why Use Wisesheets to Get Historical PE Ratios for Stocks?

When it comes to obtaining historical PE ratios for stocks, Wisesheets stands out as an exceptional tool for several reasons:

  1. Ease of Use: Wisesheets is an add-on for Excel and Google Sheets, making it a familiar and user-friendly platform for many users. You don't need to learn a new software or navigate a complicated interface to get the data you need.
  2. Comprehensive Data: Wisesheets provides a wealth of financial data, including PE ratios, both historical and real-time. This means you can access a broad range of financial information all in one place, saving you time from having to search across multiple platforms.
  3. Customizable Functions: Wisesheets offers customizable functions, allowing you to retrieve specific data for a particular company or period. This flexibility enables you to tailor your data retrieval to your specific needs and preferences.
  4. Large Data Requests: With Wisesheets, you can make large data requests, which can be particularly useful when analyzing multiple stocks or multiple years of data. This feature can save you a significant amount of time and make your spreadsheet more efficient.
  5. Support for International Tickers: Wisesheets uses the same ticker system as Yahoo Finance, which includes international tickers. This means you can analyze companies from around the world, not just those based in your home country.
  6. Active Support: If you encounter any issues or have any questions, Wisesheets offers active support through email and Discord. This ensures that you can get the help you need when you need it.
  7. Continuous Updates and Improvements: Wisesheets is continuously updated and improved, with new features and data being added regularly. This ensures that you always have access to the most up-to-date and relevant financial data.

How to Calculate Historical PE Ratios

If you'd like to calculate PE ratios manually or want to understand how the calculation is done, here's the formula:

PE Ratio = (Current Stock Price / Earnings per Share)

Earnings per share (EPS) can be found with the following formula:

EPS = (Net Income – Preferred Dividends) / Average Outstanding Shares

The net income and average outstanding shares are both found on a company's income statement. Preferred dividends are generally listed in the Notes to Financial Statements and can be added into the calculation as needed.

Once you have these numbers, simply plug them into the formula above to calculate the PE ratio for that particular company. It's important to note that this calculation does not take into account any taxes or non-cash charges, so the results may vary slightly from the ones you see from Wisesheets. However, manually calculated PE Ratios can still be useful for obtaining an approximate value of a company's stock price relative to its earnings.

By following these steps and utilizing the Wisesheets add-on, you can easily access and calculate historical PE ratios for stocks, providing you with valuable insights to inform your investment decisions.

Making Informed Decisions Based on Historical PE Ratios

When analyzing historical PE Ratios, it's important to remember that the ratio alone does not tell you whether a stock is undervalued or overvalued. Instead, it's best to use it as one data point among many when making an investment decision.

In addition, make sure to look at other metrics, such as the company's financials and market outlook, before making any decisions. This can help you identify potential risks and opportunities, enabling you to make more informed investment decisions.

Finally, don't forget to check the PE ratio of other stocks in the same industry as the one you're looking at. This will give you a better understanding of how it's performing relative to its peers and provide additional context for your decision-making process.

Conclusion

By using Wisesheets to get historical PE Ratios for stocks, investors can efficiently and accurately compare different companies and make more informed investment decisions. With its ease of use and comprehensive data retrieval capabilities, Wisesheets is an invaluable tool for any investor looking to gain insights into the stock market. Using a combination of manual calculations and the features offered by Wisesheets, investors can access valuable insights to inform their decisions.

Overall, understanding and utilizing historical PE Ratios is essential to any investor's success in the stock market. By leveraging Wisesheets as a tool to analyze these ratios, investors can gain a greater understanding of various stocks and make informed decisions about which companies to invest in. This, in turn, increases their chances of achieving higher returns on their investments.

No matter your investment goals, understanding how to use historical PE Ratios can help you make more informed decisions and ultimately lead to greater success in the stock market.

To your investing success!

Guillermo Valles

Guillermo Valles

Hello! I'm a finance enthusiast who fell in love with the world of finance at 15, devouring Warren Buffet's books and streaming Berkshire Hathaway meetings like a true fan.

I started my career in the industry at one of Canada's largest REITs, where I honed my skills analyzing deals and learning the ropes.

My passion led me to the stock market, but I quickly found myself spending more time gathering data than analyzing companies. That's when my team and I created Wisesheets, a tool designed to automate the stock data gathering process, with the ultimate goal of helping anyone quickly find good investment opportunities.

Today, I juggle improving Wisesheets and tending to my stock portfolio, which I like to think of as a garden of assets and dividends. My journey from a finance-loving teenager to a tech entrepreneur has been a thrilling ride, full of surprises and lessons.

I'm excited for what's next and look forward to sharing my passion for finance and investing with others!

2 Responses

  1. You are using general information. I. Need more information. How do I log into your program? I’m a paid subscriber. Do you have a book or manual that I can read thru?

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