Imagine buying the whole company: the P/E says how many years of current profit you pay for at today's price. P/E 20 ≈ 20 years of today's earnings until the purchase price has, on paper, earned itself back.
Rule of thumb:
MoatLens tip: A low P/E isn't always a bargain. Be careful with companies whose business swings heavily with the economy (e.g. carmakers, commodity or chemical producers): on a low P/E they look cheapest exactly when their profits are peaking – just before they fall again. For banks and insurers the P/E also says little; other metrics matter more there. Look at earnings over several years, not just the last one.
In MoatLens this explanation sits right next to the number — one tap away. And you see the ten-year trend instead of a single value.
