#cfa-level-1 #fra-introduction #reading-22-financial-statement-analysis-intro #study-session-7

Earnings are also frequently used by analysts in valuation. For example, an analyst may value shares of a company by comparing its price-to-earnings ratio (P/E) to the P/Es of peer companies and/or may use forecasted future earnings as direct or indirect inputs into discounted cash flow models of valuation.


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