COMPARING PE RATIOS AND GROWTH RATE ACROSS FIRMS

Company Trailing PE Expected Growth Standard Deviation

JPMorgan Chase & Co. 12.82 1.40% 2.40%
Bank of America Corp 12.67 10.20% 0.00%
Industrial and Commercial Bank of China 5.91 2.50% 0.00%
China Construction Bank Corp 5.37 4.00% 1.00%
Wells Fargo & Co 11.91 0.70% 2.70%
Citigroup Inc 9.8 6.10% 0.00%
Credit suisse Group 7.8 13.30% 1.00%
China Merchants Bank Co Ltd 10.44 12.70% 3.10%
Bank of China Ltd 4.58 2.50% 1.40%
Royal Bank of Canada 13 3.10% 2.40%
HDFC Bank Ltd 7.8 23.20% 1.20%
Commonwealth Bank of Australia 15.95 2.30% 0.00%
Average 9.8375 7% 0.0126666667

PE= 10.00504 - 9.58 Expected growth + 38.43 Standard Deviation

Projected PE for CITI Bank = 10.00504 - 9.58*6.1% + 38.43*0

PE 9.421

Actual PE is 9.8 where as the predicted PE is 9.42 which shows that CITI Bank is slightly overvalued.
 PEG
915.71
124.22
236.40
134.25
1701.43
160.66
58.65
82.20
183.20
419.35
33.62
693.48
143.96

slightly overvalued.
SUMMARY OUTPUT

Regression Statistics
Multiple R 0.223354
R Square 0.049887
Adjusted R Square -0.16125
Standard Error 3.848122
Observations 12

ANOVA
df SS MS F Significance F
Regression 2 6.997633 3.498816 0.236278 0.794308
Residual 9 133.2724 14.80804
Total 11 140.27

Coefficients
Standard Error t Stat
Intercept 10.00504 2.086672 4.794736
X Variable 1 -9.57519 17.16649 -0.55778
X Variable 2 38.42873 100.8942 0.380882
P-value Lower 95%Upper 95%
Lower 95.0%
Upper 95.0%
0.000981 5.284661 14.72542 5.284661 14.72542
0.590594 -48.4085 29.25811 -48.4085 29.25811
0.712126 -189.81 266.6672 -189.81 266.6672
Upper 95.0%
 PRICE TO BOOK VALUE RATIO: PREDICTION USING REGRESSION

Company Price to Book Ratio Return On equity

JPMorgan Chase & Co. 1.81 14.1
Bank of America Corp 1.28 11.1
Industrial and Commercial Bank of China 0.61 12.9
China Construction Bank Corp 0.81 13.1
Wells Fargo & Co 1.07 10.1
Citigroup Inc 0.95 10.1
Credit suisse Group 0.75 8
China Merchants Bank Co Ltd 0 16.7
Bank of China Ltd 0.62 11.2
Royal Bank of Canada 1.85 16.7
HDFC Bank Ltd 4.32 16.7
Commonwealth Bank of Australia 2.3 12.5
Average 1.36 12.77

Price to Book -0.976 + 0.216 Return on Equity - 33.31 Standard Deviation

Price to Book -0.976 + 0.21*10.1 - 33.31*0

Price to Book 1.2092366939

Company Price to Book Ratio Predicted BV

JPMorgan Chase & Co. 1.81 2.78444
Bank of America Corp 1.28 1.355
Industrial and Commercial Bank of China 0.61 1.733
China Construction Bank Corp 0.81 2.1081
Wells Fargo & Co 1.07 2.04437
Citigroup Inc 0.95 1.145
Credit suisse Group 0.75 1.0371
China Merchants Bank Co Ltd 0 3.56361
Bank of China Ltd 0.62 1.84234
Royal Bank of Canada 1.85 3.33044
HDFC Bank Ltd 4.32 2.93072
Commonwealth Bank of Australia 2.3 1.649

Actual PBV is 0.95 where as the predicted PBV is 1.209 which shows that CITI Bank is undervalued.
GRESSION

Standard Deviation
2.40%
0.00%
0.00%
1.00%
2.70%
0.00%
1.00%
3.10%
1.40%
2.40%
1.20%
0.00%
1.27%

.31 Standard Deviation

Under or OverValued
-0.5383646409
-0.05859375
-1.8409836066
-1.6025925926
-0.9106261682
-0.2052631579
-0.3828

-1.971516129
-0.8002378378
0.3215925926
0.2830434783

nk is undervalued.
SUMMARY OUTPUT

Regression Statistics
Multiple R 0.506623
R Square 0.256667
Adjusted R Square 0.091482
Standard Error 1.074563
Observations 12

ANOVA
df SS MS F Significance F
Regression 2 3.588329 1.794164 1.553813 0.263224
Residual 9 10.39216 1.154685
Total 11 13.98049

Coefficients
Standard Error t Stat
Intercept -0.97574 1.504106 -0.64871
X Variable 1 0.216334 0.125265 1.727011
X Variable 2 -33.3127 31.23442 -1.06654
P-value Lower 95%Upper 95%
Lower 95.0%
Upper 95.0%
0.532724 -4.37826 2.426789 -4.37826 2.426789
0.118238 -0.06703 0.499703 -0.06703 0.499703
0.313954 -103.97 37.3445 -103.97 37.3445
Upper 95.0%