The PE Valuation Check on a stock overview page uses two comparisons to assess if a stock is overvalued or undervalued:

1. Current PE vs 5-year Average PE: It compares the stock’s current Price-to-Earnings (PE) ratio with its average PE over the past 5 years.

2. 1Year Forward PE vs 5-year Average PE: It compares the projected 1-year forward PE (based on the estimated earnings for the next year) with the 5-year average PE.

These checks help identify whether the stock is trading above or below its usual valuation levels.

Note: The PE Valuation Check is available only for top 900 companies that have analyst earnings estimates. 

If a stock is not covered by analyst estimates, only the PE Buy/Sell Zone will be shown.

The PE Buy/Sell Zone on a stock overview page shows whether a stock is trading in the Buy or Sell Zone based on its historical price-to-earnings ratio (PE ratio). The PE ratio compares a company's stock price to its earnings per share, determining whether it is overvalued or undervalued. This section also displays the percentage of time the stock has traded below its current PE level.

To get a detailed analysis, click the arrow in the top-right corner of the feature. This will redirect you to a page where you can check whether the stock typically trades above or below its current PE level on a standalone or consolidated basis, during specific time frames.

For more details, visit this FAQ section.