Bottom line on why I chose Merck over P&G for my option trade on Friday – I was concerned that P&G is still sporting a 22.9 P/E ratio. I normally don’t trade in any stock that has a P/E over 20 – and ultimately decided that this is a good rule to keep – even if Morningstar rates it a buy. I am going to change my screen to reflect current P/E’s rather than forward P/E’s – based on this rule.
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