How to calculate the fair price of a stock
It can be challenging to calculate fair value if there are no clearly observable market prices. In general, fair value calculations fall into one of three categories. The first involves using market prices that are quoted on a transparent and liquid exchange of some kind, like a stock market. The cornerstone to valuing stocks: The P/E ratio. The go-to metric for nearly all investors when it comes to valuing a stock has to be the P/E ratio.Standing for price-to-earnings, this formula is