Stock Updates

Is this Large Market Cap Stock target price reasonable for Reynolds American Inc. (NYSE:RAI)?

The company in question is, Reynolds American Inc. (NYSE:RAI) currently with a stock price of 50.81 (-0.49% today). The market cap for Reynolds American Inc. is 72160.04, and is in the sector Consumer Goods, and Cigarettes industry. The target price for Reynolds American Inc. is 55.5. Currently Reynolds American Inc. is trading with a P/E of 13.8, and a forward P/E of 19.74. Average volume for Reynolds American Inc. is 4241.17 and so far today it is 1898031.

Performance in the last year for Reynolds American Inc. has been 23.80%. For EPS growth, Reynolds American Inc. has seen a growth of 90.00%, and is looking to grow in the next year to 11.27%. More long term stats show that EPS growth has been 17.60% over the last five years and could be 11.93% for the next five years. Reynolds American Inc. has seen sales growth quarter over quarter at 33.00%, with EPS growth quarter over quarter at -67.10%. The 20-day simple moving average is -0.90%, with the 200-day simple moving average coming to 4.45%.

Since the IPO date for Reynolds American Inc. on the 6/1/1999, Reynolds American Inc. has seen performance year to date to be 12.47%. With Reynolds American Inc. trading at 50.81, the dividend yield is 3.60%, and the EPS is 3.7.

So could Reynolds American Inc., be undervalued? Well as said before P/E is 13.8. The PEG is 1.16, P/S is 5.85 and the P/B is at 3.41. The P/cash is 37.12, with P/free cash flow at *TBA.

Reynolds American Inc. ability to deal with debt shows that the current ratio is 1, and the quick ratio is 0.7. This is with long term debt/equity at 0.62, and total debt/equity at 0.64.

In terms of margins, Reynolds American Inc. has a gross margin of 57.90%, an operating margin of 76.70% and a profit margin of 43.00%.Payout ratio for Reynolds American Inc. is 42.00%. Return on assets come to 9.90% with return on investment coming to 10.70%.

Insider ownership for Reynolds American Inc., is at 0.10% and institutional ownership comes to 48.50%. Outstanding shares are at 1413.24. While shares float is 824.16. The float short is currently 1.41%, and short ratio is 2.74.

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.

About the author

Mark Hines

Leave a Comment