Financial Statement Analysis for Price-to-Earnings (P/E) Ratio: A company's earnings per share (EPS) is $2, and its stock price is $40 per share. Calculate the company's price-to-earnings (P/E) ratio and discuss how this valuation metric reflects investor sentiment and market expectations. Analyze factors that may influence the P/E ratio, such as earnings growth prospects, industry trends, and macroeconomic conditions, and their implications for stock valuation and investment decisions.