i What this calculator does
Quick answer: Work out a share's price-to-earnings ratio from the price and earnings per share, and see how it compares to the sector and the market. With the default inputs (share price 185.50, earnings per share 15.20), it returns P/E ratio of 12.20.
The price-to-earnings ratio is the most quoted number in equity investing: what you pay for each rand of annual profit. A P/E of 12 means the price is twelve times the company's yearly earnings per share.
It is a comparison tool rather than a verdict. A low P/E can mean a bargain or a business in decline, and the only way to tell is to compare against the sector, the company's own history, and why the market has priced it where it has.
This calculator is for educational purposes only. Results are estimates and may vary depending on market conditions, spreads, commissions, platform settings, and exchange rates. It should not be considered financial advice.
How to use the P/E Ratio Calculator
It works immediately. Change one value, leave the others, and the difference belongs to that change.
- 1. Share Price (R)
- 2. Earnings Per Share (R) Annual EPS, trailing or forward
- 3. Sector Average P/E For comparison; JSE sectors vary widely
- 4. Expected Earnings Growth (%) Used for the PEG ratio
The result panel reports:
- P/E Ratio Rand paid per rand of earnings
- Earnings Yield The P/E inverted
- PEG Ratio P/E divided by growth
Alongside the headline figures, the calculator reports share price, earnings per share, sector average, vs sector. Those are the numbers that usually explain why the headline result came out where it did.
Below the figure, the calculation is shown in full, so you are not asked to take it on faith.
Common results
What the calculator returns as the share price changes, with every other input at its default (earnings per share 15.20, sector average P/E 14, expected earnings growth 8).
| Share Price | P/E Ratio | Earnings Yield | Peg Ratio |
|---|---|---|---|
| R50 | 3.29 | 30.40% | 0.41 |
| R100 | 6.58 | 15.20% | 0.82 |
| R200 | 13.16 | 7.60% | 1.64 |
| R400 | 26.32 | 3.80% | 3.29 |
| R750 | 49.34 | 2.03% | 6.17 |
| R1 500 | 98.68 | 1.01% | 12.34 |
Figures used in this calculator
The South African constants this calculator relies on, with the page that holds the current value and the date it was last verified.
- Company tax: 27%. Source: Company Tax Rates Reference (verified 29 September 2026).
- Securities Transfer Tax: 0.25% on share purchases. Source: JSE Trading Cost Schedule (verified 27 September 2026).
- JSE trading hours: 09:00 to 17:00 SAST. Source: JSE Trading Hours and Holidays (verified 27 September 2026).
How the calculation works
Four inputs drive the result: Share Price, Earnings Per Share, Sector Average P/E and Expected Earnings Growth. Earnings Per Share: Annual EPS, trailing or forward. Sector Average P/E: For comparison; JSE sectors vary widely. Expected Earnings Growth: Used for the PEG ratio. The p/e is R185.50 / R15.20 = 12.20. The earnings yield is R15.20 / R185.50 = 8.19%. The vs sector is (12.20 - 14.0) / 14.0 = -12.8%. The peg is 12.20 / 8.0 = 1.53. The breakdown also lists share price, earnings per share, P/E ratio and earnings yield.
A worked example in rand
Run it with the inputs it opens with, share price R185.50, earnings per share R15.20, sector average P/E 14 and expected earnings growth 8%, and the P/E ratio comes out at 12.20, rand paid per rand of earnings. The other figures are earnings yield 8.19% and peg ratio 1.53. Now set the share price to 371: the P/E ratio moves from 12.20 to 24.41, the earnings yield moves from 8.19% to 4.10% and the peg ratio moves from 1.53 to 3.05.
How to read the result
For the default case the verdict is: "Within a normal range of the sector average." Read it as a flag rather than advice: it tells you where the numbers sit relative to the usual rules of thumb. A single ratio is a starting question, not an answer: cheap can mean undervalued or deservedly cheap, and only the sector comparison and the earnings trend separate the two. What Is a Good Risk-Reward Ratio for Trading? explains the thinking behind these figures.
The South African angle
Using the P/E ratio calculator from South Africa adds a few local facts to the arithmetic. South African company tax is 27%, with dividends then taxed at 20% in the shareholder's hands, so the after-tax yield of a JSE dividend is materially below the headline figure. A tax-free savings account can hold JSE ETFs but not individual shares, which is why valuation of single shares matters most for taxable accounts. JSE companies report under IFRS and many present headline earnings per share, a South African measure that strips out certain items, alongside basic EPS; the two can differ materially. The P/E ratio calculator draws on the same figures, which are kept on the JSE indices reference and updated as they change.
Spotted an outdated figure? If a rate, limit or formula in this calculator no longer matches its source, email us the page and the source. A material correction is dated on the Updates Log.
Frequently asked questions
What is a good P/E ratio?
There is no universal figure. It depends on the sector, the growth rate and interest rates. JSE resource companies often trade on single-digit P/Es because earnings are cyclical, while consumer and technology companies command higher multiples. Compare against the sector rather than against a rule of thumb.
What is the difference between trailing and forward P/E?
Trailing uses the last twelve months of reported earnings, which are known. Forward uses analyst estimates for the next twelve months, which are not. Trailing is factual and backward looking; forward is relevant but unreliable. Most quoted figures are trailing unless labelled otherwise.
Why does a low P/E not always mean cheap?
The market prices in expectations. A company on a P/E of 5 may be facing a structural decline, a legal problem or a cyclical peak in earnings that is about to reverse. The ratio tells you what is being paid, not whether it should be.
Does the P/E work for loss-making companies?
No. With zero or negative earnings the ratio is meaningless, which is why this calculator says so rather than printing a number. Price to sales or price to book are the usual substitutes.
How does the P/E relate to interest rates?
Inversely, in general. When cash pays more, future earnings are discounted more heavily and multiples tend to compress. With the repo rate at 7.25% after the September 2026 increase, the hurdle for equity valuations is higher than it was.
What is the earnings yield?
The P/E turned upside down: earnings divided by price, expressed as a percentage. It is useful because it can be compared directly against a bond yield or a fixed deposit rate, which a P/E cannot.
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