Pearson plc provides learning materials, technologies, assessments, and services for teachers and students worldwide. The company is also a global leader in computer-based testing for high-stakes certification and licensure exams in the healthcare, finance, information technology, academic and admissions markets. The company was founded in 1844 and is based in London, United Kingdom.
PSO Price Forecast Based on DCF Valuation
DCF Fair Value Target:
Below please find a table outlining a discounted cash flow forecast for PSO, in which we model out valuation assuming a variety of terminal growth rates. To summarize, we found that Pearson Plc ranked in the 44th percentile in terms of potential gain offered. Specifically, our DCF analysis implies the stock is trading below its fair value by an estimated 5.5%. The most interesting components of our discounted cash flow analysis for Pearson Plc ended up being:
Pearson Plc's effective tax rate, as measured by taxes paid relative to net income, is at 0 -- greater than just 0% of US stocks with positive free cash flow.
Relative to other stocks in its sector (Consumer Cyclical), Pearson Plc has a reliance on debt greater than only 15.3% of them.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
Want more companies with a valuation profile/forecast similar to that of Pearson Plc? See CLAR, DAN, JOUT, CLUB, and SIRI.