IVD Medical Holding Limited (HKG:1931) shareholders that were waiting for something to happen have been dealt a blow with a 29% share price drop in the last month. Longer-term shareholders will rue the drop in the share price, since it's now virtually flat for the year after a promising few quarters.
Although its price has dipped substantially, it's still not a stretch to say that IVD Medical Holding's price-to-earnings (or "P/E") ratio of 8.4x right now seems quite "middle-of-the-road" compared to the market in Hong Kong, where the median P/E ratio is around 10x. However, investors might be overlooking a clear opportunity or potential setback if there is no rational basis for the P/E.
IVD Medical Holding has been doing a good job lately as it's been growing earnings at a solid pace. It might be that many expect the respectable earnings performance to wane, which has kept the P/E from rising. If that doesn't eventuate, then existing shareholders probably aren't too pessimistic about the future direction of the share price.
Want the full picture on earnings, revenue and cash flow for the company? Then our free report on IVD Medical Holding will help you shine a light on its historical performance.
How Is IVD Medical Holding's Growth Trending?
The only time you'd be comfortable seeing a P/E like IVD Medical Holding's is when the company's growth is tracking the market closely.
Taking a look back first, we see that the company managed to grow earnings per share by a handy 13% last year. Pleasingly, EPS has also lifted 47% in aggregate from three years ago, partly thanks to the last 12 months of growth. Accordingly, shareholders would have probably welcomed those medium-term rates of earnings growth.
Comparing that to the market, which is predicted to deliver 21% growth in the next 12 months, the company's momentum is weaker based on recent medium-term annualised earnings results.
In light of this, it's curious that IVD Medical Holding's P/E sits in line with the majority of other companies. It seems most investors are ignoring the fairly limited recent growth rates and are willing to pay up for exposure to the stock. Maintaining these prices will be difficult to achieve as a continuation of recent earnings trends is likely to weigh down the shares eventually.
The Key Takeaway
IVD Medical Holding's plummeting stock price has brought its P/E right back to the rest of the market. Using the price-to-earnings ratio alone to determine if you should sell your stock isn't sensible, however it can be a practical guide to the company's future prospects.
Our examination of IVD Medical Holding revealed its three-year earnings trends aren't impacting its P/E as much as we would have predicted, given they look worse than current market expectations. Right now we are uncomfortable with the P/E as this earnings performance isn't likely to support a more positive sentiment for long. Unless the recent medium-term conditions improve, it's challenging to accept these prices as being reasonable.
Before you settle on your opinion, we've discovered 2 warning signs for IVD Medical Holding that you should be aware of.
If these risks are making you reconsider your opinion on IVD Medical Holding, explore our interactive list of high quality stocks to get an idea of what else is out there.
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上个月股价下跌了29%,这给一直在等待事情发生的IVD Medical Holding Limited(HKG: 1931)的股东遭受了打击。长期股东将为股价的下跌感到遗憾,因为在经历了几个令人鼓舞的季度之后,今年的股价几乎持平。
尽管其价格已大幅下跌,但可以毫不夸张地说,与香港市场相比,IVD Medical Holding的8.4倍市盈率(或 “市盈率”)的中位数约为10倍。但是,如果市盈率没有合理的基础,投资者可能会忽略明显的机会或潜在的挫折。
IVD Medical Holding最近表现不错,其收益一直在稳步增长。可能是许多人预计可观的收益表现将减弱,这阻碍了市盈率的上升。如果最终没有发生这种情况,那么现有股东对股价的未来走向可能不会太悲观。
想全面了解公司的收益、收入和现金流吗?那么我们关于IVD Medical Holding的免费报告将帮助您了解其历史表现。
IVD Medical Holding的增长趋势如何?
只有当公司的增长密切关注市场时,你才能放心地看到像IVD Medical Holding这样的市盈率。