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the claim
The price-to-earnings ratio is a predictor of future stock returns.
the verdict
SUPPORTED
the evidence backs this
refutedsupported
the weight of evidence
12 sources for · 0 against

Multiple financial reference works and academic studies support the use of the price-to-earnings ratio (and its cyclically adjusted variants) as a predictor or indicator of future stock returns.

Evidence for · 12
Wikipedia: Cyclically adjusted price-to-earnings ratio
cited by 0
Reference article covering this claim directly
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The analysis

Judged against statistical and reference sources.

More for · 11
MIT Press: Investment intelligence from insider trading [electronic resource]
2000 · cited by 0
Book title indicates price-earnings ratio is discussed as a predictor of future stock returns.
MIT Press: Investment intelligence from insider trading
2000 · cited by 0
Book title indicates price-earnings ratio is discussed in relation to future stock returns.
McGraw-Hill: Quantitative equity portfolio management : an active approach to portfolio construction and management
2006 · cited by 0
States low price-to-earnings ratio stocks outperform high P/E stocks (value effect).
John Wiley & Sons: Your next great stock : how to screen the market for tomorrow's top performers
2008 · cited by 0
Compares price/earnings and price/sales ratios as predictors of stock gains.
Irwin: Stocks for the long run
1995 · cited by 0
Mentions price-to-earnings ratio alongside valuation factors and subsequent returns.
تحقیقات مالی: An Explanation Model of Regime Shifts in the Tehran Stock Exchange by Smooth Transfer Regression
2022 · cited by 0
Uses P/E ratio as a variable in a regime shift and return prediction model for the Tehran Stock Exchange.
OpenAIRE: Does the Stock Market Predict Macro-Variables?
2018 · cited by 0
Notes price-earnings ratio predicts the shape of the future term structure / macro variables.
OpenAIRE: Stock Price Predictor: Implementing Stocks Predictive Model Using Deep Learning
2024 · cited by 0
Uses price/earnings ratio as a key financial indicator in deep learning stock price prediction models.
OpenAIRE: A growth adjusted price-earnings ratio
2020 · cited by 0
Assesses efficacy of P/E measures as a predictor of future stock returns using portfolio methodology.
OpenAIRE: Do Valuation (P/E, ROE and P/BV) Ratios Drive Stock Values? A Case of GCC Countries
2019 · cited by 0
Investigates whether P/E valuation ratios drive stock values and returns across GCC countries.
OpenAIRE: Stock Returns Predictability Using Financial Ratios in Malaysia
2023 · cited by 0
Examines financial ratios like earnings yield for stock return predictability in Malaysia.
Everything we examined (17) — 15 independent sources
This check searched the claim as stated. It did not run a separate search for evidence against it.
  1. Wikipedia: Cyclically adjusted price-to-earnings ratioreferencesame source L1supports
  2. Wikipedia: PEG ratioreferencesame source L1no side takennot shown: read and judged not to bear on this claim
  3. MIT Press: Investment intelligence from insider trading [electronic resource]referencesame source L2supports
  4. MIT Press: Investment intelligence from insider tradingreferencesame source L2supports
  5. USC Figueroa Press: Accounting research : notes and perspectivesreferenceno side takennot shown: read and judged not to bear on this claim
  6. McGraw-Hill: Quantitative equity portfolio management : an active approach to portfolio construction and managementreferencesupports
  7. Wiley: Investment philosophies : successful strategies and the investors who made them workreferenceno side takennot shown: read and judged not to bear on this claim
  8. John Wiley & Sons: Your next great stock : how to screen the market for tomorrow's top performersreferencesupports
  9. Irwin: Stocks for the long runreferencesupports
  10. Harriman House: The best investment writing : selected writing from leading investors and authors. Volume 1referenceno side takennot shown: read and judged not to bear on this claim
  11. تحقیقات مالی: An Explanation Model of Regime Shifts in the Tehran Stock Exchange by Smooth Transfer Regressionpeer-reviewedsupports
  12. OpenAIRE: Does the Stock Market Predict Macro-Variables?peer-reviewedsupports
  13. OpenAIRE: Stock Price Predictor: Implementing Stocks Predictive Model Using Deep Learningpeer-reviewedsupports
  14. OpenAIRE: A growth adjusted price-earnings ratiopeer-reviewedsupports
  15. OpenAIRE: Do Valuation (P/E, ROE and P/BV) Ratios Drive Stock Values? A Case of GCC Countriespeer-reviewedsupports
  16. OpenAIRE: Stock Returns Predictability Using Financial Ratios in Malaysiapeer-reviewedsupports
  17. OpenAIRE: Transforming data into profit : building a transformer neural network to predict Golden Ocean stock price based on forward freight agreementspeer-reviewedno side takennot shown: read and judged not to bear on this claim
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first checked06 Aug 2026
judged → SUPPORTED · 7506 Aug 2026
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