JJ&J a retail firm has a current stock price of R1.35 per share. The company has sales of R50million, net income of R4.5 million, and 60 million outstanding shares. You are trying to value the JJ&J's stock price. The average firm in the retail sector has a price-earnings ratio of 16, price to sales ratio of 0.9 and sales per share of R0.52. Do you think JJ&J is overvalued or undervalued?

Answer rating: 100% (QA)

To determine whether JJJ is overvalued or undervalued we can use the priceearnings PE ratio and the ... View the full answer