@Kanga32 I agree that the current business can't command that...

@Kanga32

I agree that the current business can't command that sort of multiple.

However, if they hit 15%pa organic growth (for 2 years) and then with free cash flow make earnings accretive acquisitions giving total growth >30%pa, and then having a track record of >30%growth for 3 consecutive years...what sort of a PE should such a business command (particularly if there is some visibility on forward earnings at that time and continued growth)?

On a separate note the listed IT services sector is very disparate sector with many businesses going for the higher volume low margin work. I would argue that these sorts of businesses naturally should also command a lower PE multiple than superior businesses (not saying that RXP is one by any stretch of the imagination YET).

Irrespectively at face value at current prices with the current outlook statement there is IMO at least a 30-40% upside and I can't see much downside in the absence of failure to execute. The upside I was referring to is over the 2-3 year horizon to help me ascertain exit price scenarios.