Company ABC specializing in video conferencing. Explain ABC stock volatility history of approximately 81% for a 6-month period. ABC, In October 2019 the stock price was $70 then October 2020 the stock price increase to approximately $575 then decreased to $340 in March of 2021. Explain Why? Example: What environmental factors contributed to such stock over evaluations? 6-month historic volatility is approximately 81% compared to the S&P500. ABC stock was driven by an overly speculated market activities, social distancing favored strongly in ABC expansion and dominance in academia, education, remote corporate conferencing, remote workers, and a bullish market environment.

The current P/E ratio as of March 24, 2021 was 145.35x. Calculated earnings derived from dividing the Stock price / PE ratio $340/ 145.35x will yield the Earnings per share $2.33 per share. Then multiple the shares outstanding 293.71M. Determine the book value of the stock (preferred - common/ shares outstanding), then determine the P/B ratio X (Market value / Book Value) = Price to book ratio X. If X is greater than 1.0, then it is generally deemed good but if it exceeds 3.0 the stock is considered over value and considered expensive.

Explain why ABC stock was overvalue or undervalued. In this case Company ABC stock price was overvalued based on environmental influences and overly bullish market factors in response to strong demand for video conferencing?

Such analysis could also be compared to the S&P500 average growth index to determine ABC company position. 

The future of Company ABC stock lies in strategic company decisions by applying acceptable business level strategy that includes generic strategies to combat Porters' five forces such as cost leadership, differentiation, and focus strategy.