The market is not rational. It over reacts in both directions as valuations differ minute to minute, sector by sector, news release by news release, settlement by settlement etc/etc...

It is not an exact science. Fear and greed effect the pps as much, if not more, than pure fundamentals, and market analysis varies quite differently from sector to sector, event by event.

Also EDIG is not just looking at having a good year hoping to appreciate 25%, which might be a stellar year for IBM, but rather they are embarking on a new model that promises to transcend their entire operation and the pps accordingly.

As that perception becomes the reality, the PPS will be set by market forces and not the EPS, as those valuations will come much later.

A company NETTING revenues approaching hundreds of millions and trading for a dime, with a monthly nut of only about $250K is grossly undervalued.