Uploaded May 2020 | Updated September 2026, 1 hour ago
This video looks at four different ways to measure the value of a stock. The first of these is earnings per share (EPS). This shows how much money a company actually makes. The second is the P/E ratio which shows whether a company is over or undervalued (a PEG ratio can also be used for future growth). The price-to-book ratio is another way to measure whether a stock is undervalued because it takes shareholders equity (assets minus the liabilities) and divides it by the outstanding shares, before being compared to the actual share price. Finally, debt-to-equity ratios can show how highly leveraged a company is and whether their levels of debt are unsustainable.
This video looks at four different ways to measure the value of a stock. The first of these is earnings per share (EPS). This shows how much money a company actually makes. The second is the P/E ratio which shows whether a company is over or undervalued (a PEG ratio can also be used for future growth). The price-to-book ratio is another way to measure whether a stock is undervalued because it takes shareholders equity (assets minus the liabilities) and divides it by the outstanding shares, before being compared to the actual share price. Finally, debt-to-equity ratios can show how highly leveraged a company is and whether their levels of debt are unsustainable.
