Radio Shack Stock Report

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Recently Radio Shack has undergone a makeover during the last year and the result has been a noticeable improvement in their prospects. Radio Shack has always been steady through the years. There seems to be franchises in every mall or around the corner. As of recent, Radio Shack has transformed their approach on the market place and is seeking new challenges. Upon reshaping their image, Radio Shack has seen their total net sales and operating revenue for 2009 increased to $4.28 billion compared with $4.22 billion for 2008. Most of this growth has resulted from focusing on mobility and wireless products from several different brands. Instead of providing wires and connectors for component stereos, Radio Shack is now configuring…show more content…
Companies with the most consistent earnings history or strongest growth prospects receive the highest P/E multiples. We calculate price targets for the current and next fiscal year by applying the stock 's current multiple to the average professional analyst 's estimate. Valuation using RadioShack 's current multiple (P/E): Fiscal Year | Est Low/High Price Range | Avg. Est. Price | % Change for Average | 12/2010 | 24.67-29.05 | 26.28 | 11.12% | 12/2011 | 24.82-30.66 | 27.74 | 17.29% | RadioShack current price: | 23.65 | RadioShack current multiple (P/E): | 14.60 | | RadioShack average 12/2010 estimate: | 1.80 | | RadioShack low 12/2010 estimate: | 1.69 | | RadioShack high 12/2010 estimate: | 1.99 | RadioShack average 12/2011 estimate: | 1.90 | | RadioShack low 12/2011 estimate: | 1.70 | | RadioShack high 12/2011 estimate: | 2.10 |

What 's the best guess for the stock if it were valued like its peers?
Investors often come to believe that a stock is undervalued or overvalued compared to other stocks in its industrial group. To calculate an alternate target price for the current and next fiscal year based on those beliefs, investors can apply the average PE multiple for a company 's industrial group to the average professional analyst 's earnings estimate for the company in those periods. Valuation using the industry 's

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