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The current price of the Amazon stock is $1673. The latest EPS ratio was $6.04 for Q4 2018. So, the P/E ratio should be $1673/$6.04 ~ 279. But the robinhood app says the P/E ratio of Amazon is 83. What am I missing?

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  • Stack exchange didn't let me post screenshots of the app, because apparently I am still too new here..
    – kchanuec
    Mar 3, 2019 at 9:55

2 Answers 2

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The EPS of Amazon for the last quarter of 2018 was $6.05. However, the P/E ratio is calculated using an annual number for earnings. Amazon’s earnings for 2018 was $20.14. (Source)

$1673 / $20.14 = 83.07

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The price per earnings is the price divided by the yearly earnings. The Earnings per Share of quarter 4 should could be a quarter of the total earnings. Add all of the Earnings per share for 4 quarters, and use that as the Earnings.

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