Company Health
What is Forward P/E?
P/E ratio based on expected future earnings, not past ones
Full Explanation
Instead of using last year's earnings, forward P/E uses analysts' earnings estimates for the next 12 months. It's more forward-looking and usually lower than trailing P/E for growing companies.
Pro Tip
Forward P/E assumes analysts' estimates are right — they often aren't. Treat it as a directional guide.
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