A stock whose price analysts believe reflects the market's recognition of the company's underlying fundamental earnings power and therefore is unlikely to rise further in price. If the stock goes up from that price, it is called overvalued. If the stock goes down, it is termed undervalued.
Investopedia Says:
Fully valued stock belongs to companies that have disciplined plans for achieving dramatic long-term growth in both profits and revenues. Such companies must also have inherent qualities that make it difficult for new entrants into that business to share in such growth. Thus, investors who believe they are holding fully valued stock should hold it until either there has been a fundamental change in the company's nature or it has grown to a point where it will no longer be growing at a faster rate than the economy as a whole.
Related Links:
There are many ways to make money, knowing how to choose the best stocks is one of them. Guide to Stock-Picking Strategies
Learn this easy-to-understand technique of analyzing a company's financial statements and reports. Introduction To Fundamental Analysis
The P/B ratio can be an easy way to determine a company's value, but it isn't magic! Value By The Book
