Ashleigh Rogers
Long/short equity, growth at reasonable price, value, banks

Prudential's Relatively High Multiple May Be Justified

It may sound strange to say that Prudential Financial (NYSE:PRU) has a relatively high multiple with the stock trading at 14.3X ttm EPS, but the ~$40B firm is large enough so that its days of consistent double-digit growth are well behind it. Given that, it should not be much of a surprise then that Prudential generally trades for a multiple between 8-14X with notable exceptions in unusual periods. In light of that, PRU may look richly priced today or at least fairly valued. But that view fails to consider the positive factors, both company-specific and macro-level, that Prudential has going for it. I believe that these factors will drive EPS of $10.30 next year (FY 2015), leading to...

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