Q: Trying to decide whether to keep SIS or look for something with a greater return potential. When I look at the profile, (evening Dec 18), I see that it is trading at a P/E of 25.31 which seems to be based on earnings of .86, which is very close to mathing out at the share price shown of $22.25.
I also see that the current consensus estimate for EPS in 2026 is 1.37. If SIS trades at a similar P/E in Dec 2026, as it is now, 25.31, then that would give a potential share price of $34.67, approximately 56% above the current price. I see that target prices are $26-$30. Even at $30, that would make the P/E in Dec 2026 about 21; below where it is now. So, is SIS over valued now or are the estimates too low and this should be kept or bought? The high and low P/E shown in the data are very far apart so not really applicable.
An interesting note to add is that I asked Google AI for the P/E in the last 5 years and it shows the following for Dec of each of the years shown:
2020-27.4
2021-102.7 Covid outlier I guess
2022-25.5
2023-26.2
2024-29.1
2025-25.4
Sorry for the length here but don't know how else to explain my predicament...
Was going to make this public but didn't because of length- feel free to change the status if you wish.
I also see that the current consensus estimate for EPS in 2026 is 1.37. If SIS trades at a similar P/E in Dec 2026, as it is now, 25.31, then that would give a potential share price of $34.67, approximately 56% above the current price. I see that target prices are $26-$30. Even at $30, that would make the P/E in Dec 2026 about 21; below where it is now. So, is SIS over valued now or are the estimates too low and this should be kept or bought? The high and low P/E shown in the data are very far apart so not really applicable.
An interesting note to add is that I asked Google AI for the P/E in the last 5 years and it shows the following for Dec of each of the years shown:
2020-27.4
2021-102.7 Covid outlier I guess
2022-25.5
2023-26.2
2024-29.1
2025-25.4
Sorry for the length here but don't know how else to explain my predicament...
Was going to make this public but didn't because of length- feel free to change the status if you wish.
5i Research Answer:
The numbers from Google are mostly trailing-twelve-month P/E, which could be partially distorted by one-time expenses and accounting related to M&A. SIS is trading at 17x forward P/E, at the lower end of its historical averages over the last five years, which range from 15x to 25x. SIS is still a cash cow that is expected to generate stable cash flow to support dividends. SIS is a defensive type of name with slower growth and healthy cash flow. The company’s return from this point going forward should be decent, but perhaps not spectacular. Still, it has proven to be a solid, reliable, stable company over time. There are higher growth stocks, at the cost of higher valuations and more volatility: PNG, CLS, ZDC, SHOP