I was looking through the STI component stocks and I stumbled upon a stock that has a P/E ratio of only 6.4, which got me like,

“Whoa, a low P/E ratio stock on the Straits Times Index… Should I buy?”

Questions like “What is a low P/E ratio?” may ensue. It’s dependent on the industry, but also on your own take as well. What is low to me may not be for you. But as a benchmark, I am comparing it with the Straits Times Index. According to Bloomberg, the STI stocks is at a P/E ratio of 13.7 now.

In case you’re wondering, the P/E Ratio or Price-to-Earnings Ratio is a way to value a company using its share price relative to every $1 of earnings the company generates.

Simply put, a low P/E ratio means that a company’s stocks are “cheaper“. More on that below.

It piqued my