Is Public Service Enterprise Group Inc (PEG) overvalued?
On Equity Rank's model estimate, PEG trades 31% above its fair value. Public Service Enterprise Group Inc (PEG) last closed at $72.61; the multi-method model fair value is $55.57.
| Price | Model fair value | Price vs model |
|---|---|---|
| $72.61 | $55.57 | 31% above |
What the answer rests on
- 1 of 11 valuation methods put PEG's value above its price and 10 put it below, so the methods mostly agree.
- To justify today's price, PEG's free cash flow would need to grow about 23.4% a year for ten years (a reverse discounted cash flow).
- PEG trades at 20.6 times its last year's earnings, against a median of 21.2 for 66 profitable Utilities companies.
- Over the past year the price sat below the model fair value on 1% of trading days. The gap ranged from 4% below to 42% above the model fair value.
Read this before relying on it
The model fair value is an estimate from published financial statements. It is not a forecast of where the price goes, and it can be wrong. Within 10% either side we call it close to fair value: valuation models are not precise enough to read more into a smaller gap. Our own lists have no proven edge over the market yet; the live record shows every result, misses included.
Every valuation method behind PEG's fair value · What prices assume · Other companies