right now brookfield asset mgmt inc nysebam share price is at 5660 after a 01 increase moreover over the past month the stock decreased by 323 but in the past year increased by 4146 shareholders might be interested in knowing whether the stock is overvalued even if the company is performing up to par in the current session assuming that all other factors are held constant this could present itself as an opportunity for shareholders trying to capitalize on the higher share price the stock is currently below from its 52 week high by 900 the pe ratio measures the current share price to the companys earnings per share it is used by longterm investors to analyze the companys current performance against its past earnings historical data and aggregate market data for the industry or the indices such as sp 500 a higher pe indicates that investors expect the company to perform better in the future and the stock is probably overvalued but not necessarily it also shows that investors are willing to pay a higher share price currently because they expect the company to perform better in the upcoming quarters this leads investors to also remain optimistic about rising dividends in the future most often an industry will prevail in a particular phase of a business cycle than other industries compared to the aggregate pe ratio of the 3596 in the capital markets industry brookfield asset mgmt inc has a lower pe ratio of 2656 shareholders might be inclined to think that the stock might perform worse than its industry peers its also possible that the stock is undervalued there are many limitations to price to earnings ratio it is sometimes difficult to determine the nature of the earnings makeup of a company shareholders might not get what theyre looking for from trailing earnings