Say, technical stock--
because they need hugh capital investment n longer duration on returns, so usually for the first few years, the P/E ratio is v v high, but under yearly establishment, the returns comes in , thats will lower the ratio to a more reasonable lvl
Usually P/E is for comparative,
say one company's 07 P/E is 15
if it's original P/Eis 20 or 25 in 2006, thats means the company is making step forward n advancement
so take that ratio as ONE OF THE REFERENCE and added with others
references to make yr own decison