Two companies have the same long-term prospects concerning growth and ROIC. One of the companies temporarily stumbles

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Two companies have the same long-term prospects concerning growth and ROIC. One of the companies temporarily stumbles during a new product launch, and profits drop considerably as the company scrambles to fix the error.Will this company trade at a higher or lower enterprise value multiple than its stable peer? Why?
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Valuation Measuring and managing the values of companies

ISBN: ?978-0470424704

5th edition

Authors: Mckinsey, Tim Koller, Marc Goedhart, David Wessel

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