Trailing P/E ratio

Current stock price ÷ last 12 months of EPS

Analyzing valuation based on historical earnings, often for mature companies

Backward‑looking; may be distorted by one‑time items or cyclical earnings

Forward P/E ratio

Current stock price ÷ expected EPS (next 12 months)

Evaluating high‑growth or transitioning companies where future earnings matter more than historical results

Relies on uncertain earnings estimates that can change or vary by source