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What are the most important factors used when placing value on a stock.why and which is...

What are the most important factors used when placing value on a stock.why and which is more significant?
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Answer #1

Two important factors should be considered when investing funds into stock (1) Price earning ratio and (2) Earning per share

Price earning ratio measures that relationship between market price and Earning per share. A high Price earning ratio means that Investors are ready to pay more for the EPS. So a High PE ratios is always preferred before investing.

EPS ratio measures that how much free profit company is earning per share, this ratio shows the earning of the company.

These both ratios are commonly used when investing value in a stock.

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