Question
Bonus Question part 1) Stocks with P/E ratios higher than the average industry P/E are generally considered overvalued by the market. What would be your
Bonus Question part 1) Stocks with P/E ratios higher than the average industry P/E are generally considered overvalued by the market. What would be your decision if you are considering investing in such overvalued stocks? How reliable do you think the P/E ratio is in making investment decision? What in your opinion would be the best use of the P/E ratio?
Part 2)Some investors think that focusing on dividends does not help much with making investment decision on a stock, because dividends do not make significant contribution to the returns from investing in the stock. Instead, the potential for capital gain based on expectations of future growth should be the main focus. What do you think about this statement?
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