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Key Performance Indicators (KPI)
book

Key Performance Indicators (KPI)

by Bernard Marr
September 2012
Intermediate to advanced
376 pages
6h 44m
English
FT Publishing International
Content preview from Key Performance Indicators (KPI)

18

Price/earnings ratio (P/E ratio)

Strategic perspective

Financial perspective

Key performance question this indicator helps to answer

To what extent is the current share price attractive to investors?

Why is this indicator important?

Understanding how attractive your shares are to potential investors is useful. An assessment of relative share price attractiveness compared to the shares of rival companies provides managers with insights into the ease of attracting investment capital (i.e. current investor demand for a company share) as well as the attractiveness of potential takeover bids. If the share price is trading lower than it should, based on the earnings expected, a company will make an attractive takeover target.

The P/E ratio ...

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Publisher Resources

ISBN: 9780273750116