First of all, let us understand what are Multibaggers…
What are Multibaggers?
By definition, Multibaggers are stocks that increased multiple times their initial investment values. A stock that doubles its price is called two-bagger while if the price grows 10-times, it would be called a 10-bagger. This term is coined by the legendary investor – Peter Lynch.
Some notable characteristics of Multibaggers include:
Undervalued stocks with strong fundamentals Strong on corporate governance Businesses which are scalable within a short span of time. How about P/E ratio?
Most investors would know what is P/E ratio because it is the most commonly used ratio when it comes to stocks investing. And generally, a stock with a lower P/E is perceived as a better investment than a stock with a higher one.
The idea behind this perception is that companies with low P/E ratios may indicate that the stock is undervalued. Investors can