Accounting / July 9, 2018 / Justice Buckley
Net Working Capital It implies the surplus of current assets over current liabilities. A positive net working capital shows the company’s ability to cover short-term liabilities, whereas a negative net working capital indicates the company’s inability in fulfilling short-term obligations.
It is possible to invest based on the PE of an individual stock, but most people look at an overall PE ratio for the market. Many people say the stock market is overvalued when the PE ratio of the market is above average. What exactly is average? Here are a few historical high and low points in the market that will give you some insight into normal, abnormal, and average PE ratios.
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