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TWEEDY, BROWNE COMPANY L.P.
What Has Worked in Investing
(continued from preceding page)


Table 36:
Investment Returns and Characteristics for Ten Price/Earnings Ratio Groups of NYSE and AMEX Stocks, March 31, 1951 to December 31, 1986



Price/Earnings
Ratio Groups

1 (Lowest price to earnings ratio)

2

3

4

5

6

7

8

9

10 (Highest price to earnings ratio)


Annual
Investment
Return

19.08%


19.08

18.00

16.32

14.04

13.68

12.60

13.20

13.32

14.28


Average
Price/Earnings
Ratio

5.6x


7.6

8.6

9.6

10.6

11.7

13.1

15.2

18.8

31.5

Average
Market
Capitalization
(Millions)

$365.6


428.0

557.0

474.5

582.0

705.4

679.7

669.6

792.2

874.8


As Table 36 indicates lower price/earnings ratios were associated with smaller market capitalization over this period of 35 years and nine months.

Page 40 of 42

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