as manshoon stated, its also about the potential for future earnings that are based on guidance given by the company...ill add that analysts also give their estimates as well based on their study of the stock and the numbers...the pps can be given multiples of 7, 15 or whatever...at some point it could go to far..depends..i could go on about book value, good will etc but im pretty sure it would be over your head..
so no, its not about gypsies or crytal balls or any other such nonsense...its the stock market...thats how it works...thats how its done....