Wan Kei Group Holdings Limited (HKG:1718) shares have had a horrible month, losing 29% after a relatively good period beforehand. The drop over the last 30 days has capped off a tough year for shareholders, with the share price down 37% in that time.
Although its price has dipped substantially, you could still be forgiven for feeling indifferent about Wan Kei Group Holdings' P/S ratio of 0.3x, since the median price-to-sales (or "P/S") ratio for the Construction industry in Hong Kong is about the same. While this might not raise any eyebrows, if the P/S ratio is not justified investors could be missing out on a potential opportunity or ignoring looming disappointment.
See our latest analysis for Wan Kei Group Holdings
How Has Wan Kei Group Holdings Performed Recently?
It looks like revenue growth has deserted Wan Kei Group Holdings recently, which is not something to boast about. It might be that many expect the uninspiring revenue performance to only match most other companies at best over the coming period, which has kept the P/S from rising. Those who are bullish on Wan Kei Group Holdings will be hoping that this isn't the case, so that they can pick up the stock at a lower valuation.
We don't have analyst forecasts, but you can see how recent trends are setting up the company for the future by checking out our free report on Wan Kei Group Holdings' earnings, revenue and cash flow.
Is There Some Revenue Growth Forecasted For Wan Kei Group Holdings?
The only time you'd be comfortable seeing a P/S like Wan Kei Group Holdings' is when the company's growth is tracking the industry closely.
If we review the last year of revenue, the company posted a result that saw barely any deviation from a year ago. That's essentially a continuation of what we've seen over the last three years, as its revenue growth has been virtually non-existent for that entire period. Accordingly, shareholders probably wouldn't have been satisfied with the complete absence of medium-term growth.
Comparing the recent medium-term revenue trends against the industry's one-year growth forecast of 13% shows it's noticeably less attractive.
With this in mind, we find it intriguing that Wan Kei Group Holdings' P/S is comparable to that of its industry peers. 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 revenue trends is likely to weigh down the shares eventually.
The Final Word
Following Wan Kei Group Holdings' share price tumble, its P/S is just clinging on to the industry median P/S. We'd say the price-to-sales ratio's power isn't primarily as a valuation instrument but rather to gauge current investor sentiment and future expectations.
We've established that Wan Kei Group Holdings' average P/S is a bit surprising since its recent three-year growth is lower than the wider industry forecast. Right now we are uncomfortable with the P/S as this revenue performance isn't likely to support a more positive sentiment for long. If recent medium-term revenue trends continue, the probability of a share price decline will become quite substantial, placing shareholders at risk.
Before you settle on your opinion, we've discovered 2 warning signs for Wan Kei Group Holdings (1 makes us a bit uncomfortable!) that you should be aware of.
If these risks are making you reconsider your opinion on Wan Kei Group Holdings, explore our interactive list of high quality stocks to get an idea of what else is out there.
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.
Wan Kei Group Holdings Limited(HKG:1718)の株式は、比較的良い期間の後に29%下落し、ひどい月を過ごしました。最近の30日間の価格下落は、株主にとって厳しい年を埋めるもので、その期間に株価は37%下落しました。
株式価格が大幅に下落しても、 Wan Kei Group HoldingsのP / S比率が0.3xであることに無関心に感じることができますが、香港の建設業界のP / S比率の中央値はほぼ同じです。これは眉をひそめることはないかもしれませんが、P / S比率が正当化されない場合、投資家は潜在的な機会を見逃したり、迫り来る失望を無視する可能性があります。
Wan Kei Group Holdingsの最新の分析をご覧ください
Wan Kei Group Holdingsの最近のパフォーマンスはどうですか?
収益成長が見られないWan Kei Group Holdingsは最近、自慢に値するものではありません。恒例の収益パフォーマンスが、将来のほとんどの他の企業によく似ていることが期待されることが原因で、P / Sの上昇を阻止しています。Wan Kei Group Holdingsに強気な人々は、これがそうでない場合、つまり彼らが低い評価で株式を購入できるように、期待しています。
私たちはアナリストの予測を持っていませんが、Wan Kei Group Holdingsの収益、売上高、キャッシュフローに関する私たちの無料レポートをチェックして、最近のトレンドが将来の企業をどのようにセットアップしているかを確認することができます。
Wan Kei Group Holdingsには売上高の成長が予測されていますか?
Wan Kei Group HoldingsのP / SのようなP / Sを見るのは、企業の成長が業界に追随している場合にのみ、快適な状態です。
このことを考えると、Wan Kei Group HoldingsのP / Sが業界の仲間とほぼ同じであることは興味深いことです。それは、成功した株式にエクスポージャーを提供するために比較的限定的な最近の成長率を無視する投資家が大半であるようです。これらの価格を維持することは困難であり、最近の収益のトレンドを継続することは、最終的には株価を圧迫する可能性があります。
最終的な言葉
Wan Kei Group Holdingsの株価が下落したことに伴い、そのP / Sは業界の中央値P / Sに引っ掛かっています。価格対売上高比率のパワーは、主に現在の投資家の感情と将来の期待を測定することであると言えます。
Wan Kei Group Holdingsの平均P / Sは、最近の3年間の成長がより広い業界の予測よりも低いことから、少し驚くべきものです。現在、私たちはこの収益パフォーマンスに不快感を抱いているため、P / Sには不快感を抱いています。これが中期的な収益トレンドが継続する場合、株価の下落の可能性が非常に高くなり、株主がリスクを負うことになります。
あなたが意見を決定する前に、 Wan Kei Group Holdingsに関する警告が2つあります(1つは私たちを少し不快にする)。
これらのリスクが、あなたのWan Kei Group Holdingsに関する意見を再考させる場合は、私たちのインタラクティブな高品質株式リストを探索して、他に何があるかを見てみてください。