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Is this Large Market Cap Stock target price reasonable for Pearson plc (NYSE:PSO)?

The company in question is, Pearson plc (NYSE:PSO) currently with a stock price of 10.12 (1.74% today). The market cap for Pearson plc is 8168.35, and is in the sector Services, and Publishing – Books industry. The target price for Pearson plc is 13.8. Currently Pearson plc is trading with a P/E of *TBA, and a forward P/E of 12.18. Average volume for Pearson plc is 406.55 and so far today it is 256793.

Performance in the last year for Pearson plc has been -41.94%. For EPS growth, Pearson plc has seen a growth of -275.70%, and is looking to grow in the next year to 8.79%. More long term stats show that EPS growth has been -21.60% over the last five years and could be -0.70% for the next five years. Pearson plc has seen sales growth quarter over quarter at -8.80%, with EPS growth quarter over quarter at -744.50%. The 20-day simple moving average is -5.33%, with the 200-day simple moving average coming to -9.60%.

Since the IPO date for Pearson plc on the 11/18/1996, Pearson plc has seen performance year to date to be -1.87%. With Pearson plc trading at 10.12, the dividend yield is 4.72%, and the EPS is -0.75.

So could Pearson plc, be undervalued? Well as said before P/E is *TBA. The PEG is *TBA, P/S is 1.49 and the P/B is at 1. The P/cash is 6.41, with P/free cash flow at *TBA.

Pearson plc ability to deal with debt shows that the current ratio is 2.1, and the quick ratio is 1.9. This is with long term debt/equity at 0.36, and total debt/equity at 0.38.

In terms of margins, Pearson plc has a gross margin of 55.60%, an operating margin of -12.90% and a profit margin of 15.70%.Payout ratio for Pearson plc is 62.10%. Return on assets come to 6.00% with return on investment coming to -3.70%.

Insider ownership for Pearson plc, is at 1.90% and institutional ownership comes to 2.10%. Outstanding shares are at 820.94. While shares float is 812.35. The float short is currently 0.10%, and short ratio is 2.08.

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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Stephen Butters

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