Question 457 PE ratio, Multiples valuation
Which firms tend to have low forward-looking price-earnings (PE) ratios? Only consider firms with positive PE ratios.
(a) Highly liquid publically listed firms.
(b) Firms in a declining industry with very low or negative earnings growth.
(c) Firms expected to have temporarily low earnings over the next year, but with higher earnings later.
(d) Firms whose returns have a very low level of systematic risk.
(e) Firms whose assets include a very large proportion of cash.