P/E ratio is a terrible, meaningless way to evaluate the price of a share. It sounds remotely technical, and hey, there are numbers there so I guess people talk

P/E ratio is a terrible, meaningless way to evaluate the price of a share. It sounds remotely technical, and hey, there are numbers there so I guess people talk about it like it's important. P/E ratio is the ratio between profits to price per share. If the company had shares trading at $100 and their profits were $10/share, their P/E ratio would be 10. The thing is, P/E ratio doesn't capture expenditures very well, or long term corporate plans. So if a company is spending a ton of money trying to expand their business, they will have a really high P/E ratio. That doesn't make it a bad thing, just a measure of how much they're spending. AMZN is spending a ton of money lately, so they are not as profitable as they could be (and hence, high P/E ratio), but it is presumably to secure their future success.