MINISO Group Holding Limited's (NYSE:MNSO) price-to-earnings (or "P/E") ratio of 20.3x might make it look like a sell right now compared to the market in the United States, where around half of the companies have P/E ratios below 16x and even P/E's below 9x are quite common. However, the P/E might be high for a reason and it requires further investigation to determine if it's justified.
MINISO Group Holding certainly has been doing a good job lately as its earnings growth has been positive while most other companies have been seeing their earnings go backwards. It seems that many are expecting the company to continue defying the broader market adversity, which has increased investors' willingness to pay up for the stock. If not, then existing shareholders might be a little nervous about the viability of the share price.
If you'd like to see what analysts are forecasting going forward, you should check out our free report on MINISO Group Holding.
Does Growth Match The High P/E?
There's an inherent assumption that a company should outperform the market for P/E ratios like MINISO Group Holding's to be considered reasonable.
Taking a look back first, we see that the company grew earnings per share by an impressive 116% last year. However, the latest three year period hasn't been as great in aggregate as it didn't manage to provide any growth at all. Accordingly, shareholders probably wouldn't have been overly satisfied with the unstable medium-term growth rates.
Shifting to the future, estimates from the analysts covering the company suggest earnings should grow by 18% per year over the next three years. That's shaping up to be materially higher than the 10% per annum growth forecast for the broader market.
In light of this, it's understandable that MINISO Group Holding's P/E sits above the majority of other companies. Apparently shareholders aren't keen to offload something that is potentially eyeing a more prosperous future.
The Bottom Line On MINISO Group Holding's P/E
Typically, we'd caution against reading too much into price-to-earnings ratios when settling on investment decisions, though it can reveal plenty about what other market participants think about the company.
As we suspected, our examination of MINISO Group Holding's analyst forecasts revealed that its superior earnings outlook is contributing to its high P/E. At this stage investors feel the potential for a deterioration in earnings isn't great enough to justify a lower P/E ratio. It's hard to see the share price falling strongly in the near future under these circumstances.
Many other vital risk factors can be found on the company's balance sheet. Take a look at our free balance sheet analysis for MINISO Group Holding with six simple checks on some of these key factors.
It's important to make sure you look for a great company, not just the first idea you come across. So take a peek at this free list of interesting companies with strong recent earnings growth (and a low P/E).
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MINISO Group Holding Limited(NYSE:MNSO)のP/E比率20.3倍は、アメリカの市場に比べると売りに見えるかもしれません。米国の半分の企業がP/E比率が16倍以下で、9倍以下のP/Eの企業もかなり一般的です。 しかし、P/Eが高いのは理由があるかもしれず、正当化されているかどうかを判断するためにはさらなる調査が必要です。
MINISO Group Holdingは、他の多くの企業が収益を後退させている中、収益成長がプラスであったため、最近では良い仕事をしていると言えます。 明らかに多くの人々は、企業が市場全体の逆境に抵抗し続けることを期待しており、これにより、株式に対する投資家の意欲が高まっています。もし逆の場合は、既存の株主たちは株価の持続可能性について少し不安に感じるかもしれません。
アナリストの将来予測を知りたい場合は、MINISO Group Holdingに関する無料レポートをチェックすることをお勧めします。
成長は高いP/Eにマッチするか?
MINISO Group HoldingのようなP/E比率に対しては、企業が市場を上回って業績を上げることが当然の前提とされています。