I use forward estimates of operating income rather than PE. It includes forward earnings estimates whether provided by the company or a consensus estimate. It may not be accurate but it generally is better than trailing. I use EBITDA not EBIT as most of my investments report using US GAAP that is seriously flawed with respect to intangibles and consolidation principles. For example, if you look at the most recent Microsoft 10Q the notes disclose that the entire carrying cost of intangibles will eventually be expensed. Will the value of MSWord ever be zero? To me that makes no sense. There is a similar issue with many REITs when properties are written down as the appraised value increases. When Canada went from GAAP to IFRS accounting standards in 2011 the expense line “Depreciation” disappeared from expenses in financial statements. In addition, a new line often appeared booking the increase in the appraised value as earnings. When I estimate value I apply a reasonable multiple to forward EBITDA. Firms like Taureau Group monitor business sales and report the multiples of Enterprise Value to EBITDA. Generally a multiple of six provides a conservative estimate of intrinsic value. The Magic Formula (Joel Greenblatt) and The Acquirer’s Multiple (Toby Carlysle) use trailing EBIT to Enterprise Value. Books by each are worth reading..