Titan Pharmaceuticals Inc (TTNP)

[tipdigger86]

it will be revenue (earnings) when reported in the quarterly ER. It will also be cash on the books.

P/E multiples (price to earnings) are calculated by taking the current price and dividing by the earnings. If you look to TTM P/E ratios, you would use actual revenue from the trailing twelve months (which would also be cash on the books or already spent on expenses). If you look to forward looking P/E ratios, you would look to projected earnings over the next twelve months. Typically, TTM P/E ratios are higher because they are based on actual earnings and therefore provide a likely benchmark for future earnings. Forward-looking P/Es are typically lower because of the unknowns in future earnings.

The ratios provided in my previous link are industry-specific forward-looking averages, meaning what multiple the market thinks the average company should trade in a given industry.

If earnings come in higher than expected, the P/E ratio for that stock will automatically go down and should signal to the market that the price is lower than it should be. Assuming the price goes up, the P/E ratio will also rise and, once the market feels it is back in line with expectations, stock price should level off until given a reason to move again.

That is the rational market theory - obviously, TTNP does not track rationality too well.