I think the QQQ P/E is about 183 using trailing twelve months earnings and the following calculation method:
Consider that QQQ is a basket of 100 stocks weighted in accordance with the list on this page (which is updated daily)
dynamic.nasdaq.com
For a 10K$ investment, one would own 100$ worth of COMS, 210$ worth of ABGX, and so on down the list. Calculate how many shares that amount purchases at a recent market price, and multiply by the EPS for that stock (whether positive or negative) to get the earnings contribution of that stock. Repeat that for all 100 stocks and add up the results. I get net earnings of about 54.66$ per 10K$ investment for a P/E of 183.
Sound expensive? Well, sure, but this is for trailing twelve months earnings, and, more important, includes losses as well as profits.
In the hypothetical 10K investment, one is buying 71 profitable companies with total positive earnings of 175$ and 29 money losing companies with total losses of about 120$, making the net of about 55$. If all the money losing companies made it to EPS b/e, the P/E would be about 60. |
