Question
The stock price for PS Industries is currently $88.75. The companys PE ratio is expected to remain between 10 and 12 for the next five
The stock price for PS Industries is currently $88.75. The companys PE ratio is expected to remain between 10 and 12 for the next five years. The current dividend is $4.28 per share annually and is expected to grow at 5% over the next five years. The current EPS is $6.47 and is expected to grow 2.5% over the next five years. The companys required return is 12.5%. Estimate the PV of the companys stock price and its dividends and determine the companys current value per share. Based on this information and your estimate of value, is the company over or under-valued?
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