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Is this Large Market Cap Stock target price reasonable for Dolby Laboratories, Inc. (NYSE:DLB)?

The company in question is, Dolby Laboratories, Inc. (NYSE:DLB) currently with a stock price of 51.44 (-0.04% today). The market cap for Dolby Laboratories, Inc. is 5245.83, and is in the sector Technology, and Diversified Electronics industry. The target price for Dolby Laboratories, Inc. is 51. Currently Dolby Laboratories, Inc. is trading with a P/E of 25.25, and a forward P/E of 24.72. Average volume for Dolby Laboratories, Inc. is 419.34 and so far today it is 111534.

Performance in the last year for Dolby Laboratories, Inc. has been 51.59%. For EPS growth, Dolby Laboratories, Inc. has seen a growth of -12.20%, and is looking to grow in the next year to 16.31%. More long term stats show that EPS growth has been -6.60% over the last five years and could be 10.00% for the next five years. Dolby Laboratories, Inc. has seen sales growth quarter over quarter at 19.80%, with EPS growth quarter over quarter at 81.70%. The 20-day simple moving average is 0.44%, with the 200-day simple moving average coming to 15.38%.

Since the IPO date for Dolby Laboratories, Inc. on the 2/17/2005, Dolby Laboratories, Inc. has seen performance year to date to be 54.21%. With Dolby Laboratories, Inc. trading at 51.44, the dividend yield is 0.93%, and the EPS is 2.04.

So could Dolby Laboratories, Inc., be undervalued? Well as said before P/E is 25.25. The PEG is 2.53, P/S is 5.12 and the P/B is at 2.68. The P/cash is 7.3, with P/free cash flow at 72.46.

Dolby Laboratories, Inc. ability to deal with debt shows that the current ratio is 4.1, and the quick ratio is 4. This is with long term debt/equity at 0, and total debt/equity at 0.

In terms of margins, Dolby Laboratories, Inc. has a gross margin of 89.80%, an operating margin of 23.30% and a profit margin of 20.30%.Payout ratio for Dolby Laboratories, Inc. is 23.20%. Return on assets come to 9.60% with return on investment coming to 8.30%.

Insider ownership for Dolby Laboratories, Inc., is at 0.80% and institutional ownership comes to 96.70%. Outstanding shares are at 101.94. While shares float is 51.95. The float short is currently 5.02%, and short ratio is 6.21.

Disclaimer: Remember there is a risk to your investment, this is not a recommendation, nor personal advice, never invest more than you are able too loose.

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Mark Hines

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