Only companies making profits have P/E ratios, Tesla is still losing money so its P/E doesn't dictate its share price, only its projected future growth/sales.
P/E ratios don't tell the whole story, e.g. AMZN has a high P/E ratio because they aim for low profitability by reinvesting in growth, similar to Netflix who's still taking on debt to build out its inventory.
When a companies growth and revenue has stagnated their P/E ratio then becomes a strong indicator for market value / share price.
P/E ratios don't tell the whole story, e.g. AMZN has a high P/E ratio because they aim for low profitability by reinvesting in growth, similar to Netflix who's still taking on debt to build out its inventory.
When a companies growth and revenue has stagnated their P/E ratio then becomes a strong indicator for market value / share price.