PER (Price Earnings Ratio)
How would you say this out loud?
Pee-Ee-Ar or just 'per'?
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1Just reading this on the screen right now, I would say, "per," but it probably depends on the sentence and context and almost more importantly, whatever you guys use around the office.– Teacher KSHuangCommented Jan 17, 2017 at 9:06
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3To close-voters. This not a opinion-based issue. The acronym has a precise and common pronunciation in financial contexts. Different pronunciations would be misunderstood or sound unusual.– user66974Commented Jan 17, 2017 at 15:10
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1I have rarely encountered PER; P/E or PE is more common.– chosterCommented Jan 17, 2017 at 15:23
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1 Answer
The more common pronunciation used in financial contexts is (pee-ee ratio) /ˌpiː iː ˈreɪʃiːəʊ/ also often written P/E ratio:
- The price-earnings ratio (P/E Ratio) is the ratio for valuing a company that measures its current share price relative to its per-share earnings.
You can hear its usage and pronunciation in the following video P/E Ratio
The history of price to earnings ratio:
- “The P/E ratio is today the most commonly used valuation metric in the world.” --- Prof. Janette Rutterford, Open University. The P/E has a long history, but it has not always been the most popular way to value shares. Since the invention of stock markets up until less than 100 years ago, the dividend yield (DY) was the main figure every investor was interested in. The asset backing behind a company was also important. The P/E is, compared to those two, a relatively recent invention. Even the phrase ‘price earnings ratio’ only became popular in the 1920s in the US. In the UK dividends were still what mattered up until the mid-1960s.
