The ratio of the profits over earnings of a business to the ratio of the profits over earnings in the market. The percentage of profits is divided by the percentage of earning. A relative P/E can be measured the following ways: terms of current earnings, trailing, and forward earnings. However, only one of these must be used over the long term for comparing the firm and the market for consistent accuracy.

Related information about relative P/E ratio:

1. What's the difference between absolute P/E ratio and relative P/E ...
   May 10, 2005 ... The relative P/E ratio, on the other hand, is a measure that compares the current P/E ratio to the past P/E ratios of the company or to the current ...
    
2. What is a Relative PE and Why is it Important?
   Oct 7, 2009 ... P/E means very little when viewed on its own, which is why Relative P/E is so important. Relative P/E compares the P/E of an individual stock ...
    
3. What is relative P/E ratio? definition and meaning
   Definition of relative P/E ratio: The ratio of the profits over earnings of a business to the ratio of the profits over earnings in the market. The percentage of profits is ...
    
4. How to use P/E as a valuation tool | Stocks
   The relative P/E ratio is a ratio between the current P/E and historical P/E's. A relative P/E has a numerical range of between 0-100%, representing the all time ...
    
5. Relative P/E Ratio - Financial Dictionary - The Free Dictionary
   Relative PE. (redirected from Relative P/E Ratio). 0.01 sec. Relative PE. A firm or industry's price to earnings ratio divided by the market price to earnings ratio.
    
6. 50 Lowest Relative P/E Ratios in the S&P 500 - Seeking Alpha
   Jan 31, 2008 ... The relative P/E ratio compares the stock's estimated P/E ratio over the ... A relative P/E ratio less than 1 means the stock's P/E is less than its ...
    
7. P/E-ratios in relative valuation – a mission impossible?
   shown that relative P/E-ratio valuation will not be able to handle differences in the expected book return or growth of owners' equity. In an empirical context ...
    
8. P/E-ratios in relative valuation - Business Perspectives
   shown that relative P/E-ratio valuation will not be able to handle differences in the expected book return or growth of owners' equity. In an empirical context ...