The Streamline Health Solutions, Inc. (NASDAQ:STRM) share price has softened a substantial 29% over the previous 30 days, handing back much of the gains the stock has made lately. For any long-term shareholders, the last month ends a year to forget by locking in a 84% share price decline.
After such a large drop in price, Streamline Health Solutions may be sending bullish signals at the moment with its price-to-sales (or "P/S") ratio of 0.8x, since almost half of all companies in the Healthcare Services industry in the United States have P/S ratios greater than 1.9x and even P/S higher than 5x are not unusual. However, the P/S might be low for a reason and it requires further investigation to determine if it's justified.
How Streamline Health Solutions Has Been Performing
Streamline Health Solutions could be doing better as its revenue has been going backwards lately while most other companies have been seeing positive revenue growth. It seems that many are expecting the poor revenue performance to persist, which has repressed the P/S ratio. So while you could say the stock is cheap, investors will be looking for improvement before they see it as good value.
Want the full picture on analyst estimates for the company? Then our free report on Streamline Health Solutions will help you uncover what's on the horizon.
What Are Revenue Growth Metrics Telling Us About The Low P/S?
The only time you'd be truly comfortable seeing a P/S as low as Streamline Health Solutions' is when the company's growth is on track to lag the industry.
Retrospectively, the last year delivered virtually the same number to the company's top line as the year before. Although pleasingly revenue has lifted 117% in aggregate from three years ago, notwithstanding the last 12 months. So while the company has done a solid job in the past, it's somewhat concerning to see revenue growth decline as much as it has.
Looking ahead now, revenue is anticipated to climb by 4.1% per year during the coming three years according to the two analysts following the company. That's shaping up to be materially lower than the 14% per annum growth forecast for the broader industry.
In light of this, it's understandable that Streamline Health Solutions' P/S sits below the majority of other companies. It seems most investors are expecting to see limited future growth and are only willing to pay a reduced amount for the stock.
The Final Word
Streamline Health Solutions' P/S has taken a dip along with its share price. While the price-to-sales ratio shouldn't be the defining factor in whether you buy a stock or not, it's quite a capable barometer of revenue expectations.
As expected, our analysis of Streamline Health Solutions' analyst forecasts confirms that the company's underwhelming revenue outlook is a major contributor to its low P/S. Shareholders' pessimism on the revenue prospects for the company seems to be the main contributor to the depressed P/S. Unless these conditions improve, they will continue to form a barrier for the share price around these levels.
Before you settle on your opinion, we've discovered 4 warning signs for Streamline Health Solutions (1 doesn't sit too well with us!) that you should be aware of.
If strong companies turning a profit tickle your fancy, then you'll want to check out this free list of interesting companies that trade on a low P/E (but have proven they can grow earnings).
Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Streamline Health Solutions, Inc.(纳斯达克股票代码:STRM)的股价在过去30天中大幅下跌了29%,收回了该股最近的大部分涨幅。对于任何长期股东来说,最后一个月的股价下跌幅度为84%,从而结束了令人难忘的一年。
在价格大幅下跌之后,Streamline Health Solutions目前可能正在发出看涨信号,其市销率(或 “市盈率”)为0.8倍,因为美国医疗服务行业几乎有一半的公司市盈率大于1.9倍,甚至市盈率高于5倍的情况并不少见。但是,市销率低可能是有原因的,需要进一步调查以确定其是否合理。
Streamline 健康解决方案的表现如何
Streamline Health Solutions可能会做得更好,因为其收入最近一直在倒退,而大多数其他公司的收入却出现了正增长。看来许多人预计糟糕的收入表现将持续下去,这抑制了市销率。因此,尽管你可以说股票很便宜,但投资者在将其视为物有所值之前会寻求改善。
想全面了解分析师对公司的估计吗?然后,我们关于Streamline Health Solutions的免费报告将帮助您发现即将发生的事情。
关于低市盈率,收入增长指标告诉我们什么?
只有当公司的增长有望落后于该行业时,你才能真正放心地看到像Streamline Health Solutions一样低的市销率。