Exxon Mobil (NYSE: XOM)

8.7

BHP Billiton (NYSE: BHP)

8.5

Coach (NYSE: COH)

8.2

Toyota (NYSE: TM)

8.0

Fairfax Financial Holdings (NYSE: FFH)

3.6

Source: Capital IQ, a division of Standard & Poor's.

Ah, but remember my warning earlier. P/E ratios are an imperfect measure of cheapness.  They're just a place to start, because a company's future earnings can be very different from its trailing earnings. See the aforementioned losses in the financial sector. Investors looking at just the trailing earnings a year ago would have been tricked into a false bargain. Similarly, investors looking at retailers today should consider that its earnings just aren't going to be as strong in the next few quarters as they were in the past.

Should you buy?
Investors are clearly fearful of the future earnings of the stocks in the table above. That's why they're trading at such low P/Es. The market is throwing a sale, but it's up to you to determine which of its merchandise is worth buying.

A simple metric isn't going to cut it. That's a great place to start, but you have to do your research and determine what you believe a company's future earnings power will be. Only then can you judge whether a company is a value or a value trap.

Our Inside Value team spends its days (and sometimes nights) doing just such analysis. They break each potential stock pick down, determine its earnings power, and then figure out whether it's a good value. If you'd like to see the companies that have made their buy list, a 30-day trial is free. There's no obligation to subscribe.

Anand Chokkavelu has a P/E ratio of just 2.4 … the market will wake up one day. He does not own shares in any company mentioned. UnitedHealth Group, Coach, and Berkshire Hathaway are Motley Fool Stock Advisor picks. UnitedHealth Group and Berkshire Hathaway are also Motley Fool Inside Value recommendations and Fool holdings. The Fool has a disclosure policy.