If a share of stock in Dell sells for $70, the retained earnings per share are $5, and the dividend per share is $2, then the price-earnings ratio is 10.

Price-Earnings Ratio

A valuation metric for stocks, calculated by dividing the market price per share by the earnings per share, used to assess a company's relative valuation.

Retained Earnings

Profits that a company keeps after dividends are paid, which are often reinvested into the business for growth or debt repayment.