Most CEOs claim the market is undervaluing their company's stock; a select few take it one step further and actually provide investors a price target. Let's take a look at four CEOs who reveal what they believe their company's stock is actually worth.
Chief executive optimist
Chesapeake (NYS: CHK) CEO Aubrey McClendon believes the market is offering a half-price sale on Chesapeake's stock. The reason centers around the market value, or lack thereof, placed on Chesapeake's unproved reserves. McClendon says Chesapeake's unproved reserves are given no value when, in fact, the reserves are worth roughly $40 billion, at a minimum.
E-Commerce China Dangdang (NYS: DANG) chief executive Guoqing Li sees tremendous upside in his company's stock as well. The CEO of the Chinese e-retailer recently set a price target of $22, nearly twice the current market value. Li claims the stock is selling at a discount as a result of a botched IPO. However, it could be the market believes Dangdang doesn't deserve such a lofty multiple.
PotashCorp (NYS: POT) CEO Bill Doyle believes the future is bright for the fertilizer company he heads. Doyle believes PotashCorp's stock price should "far exceed" its current per-share price of $57. Doyle predicted PotashCorp's stock would "blow the doors off" an all-time split-adjusted high of roughly $80 a share. PotashCorp's surge in share price over the past decade is the result of an increase in demand for fertilizer, a trend Doyle expects to continue.
EXCO Resources (NYS: XCO) CEO Douglas Miller is so confident the company he heads is undervalued that he anted up $18.50 a share to take it private. Shareholders recently rejected the offer, which represented nearly a 15% premium to the recent stock price. EXCO Resources, which holds valuable assets in fertile fossil fuel formations, continues to be an attractive takeover candidate and could see additional offers.
The bottom line
It's always nice when a CEO puts a price on a stock. But don't take their word for it. Research these stocks yourself to determine if the "undervalued" claim checks out.
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At the time thisarticle was published Fool contributorAdam J. Crawforddoes not own shares in any company mentioned in this article. Motley Fool newsletter services have recommended buying shares of Chesapeake Energy. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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