If the industry has a justified leading PE of10 and while the stock has a justified leading PE of 12, then obviously the stock is overvalued (expensive).
However, I just ran into a question where the justified trailing PE for the industry is 10, while the stock’s justified trailing PE is 12 – answer explained that the stock was undervalued but it didnt give further explaination.
Is this because trailing PE already occurred so the comparison is the opposite of justified leading PE?