Despite an already strong run, HM International Holdings Limited (HKG:8416) shares have been powering on, with a gain of 29% in the last thirty days. Unfortunately, the gains of the last month did little to right the losses of the last year with the stock still down 19% over that time.
In spite of the firm bounce in price, you could still be forgiven for feeling indifferent about HM International Holdings' P/E ratio of 6.9x, since the median price-to-earnings (or "P/E") ratio in Hong Kong is also close to 9x. Although, it's not wise to simply ignore the P/E without explanation as investors may be disregarding a distinct opportunity or a costly mistake.
For instance, HM International Holdings' receding earnings in recent times would have to be some food for thought. It might be that many expect the company to put the disappointing earnings performance behind them over the coming period, which has kept the P/E from falling. If you like the company, you'd at least be hoping this is the case so that you could potentially pick up some stock while it's not quite in favour.
SEHK:8416 Price to Earnings Ratio vs Industry March 27th 2024 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 HM International Holdings' earnings, revenue and cash flow.
Is There Some Growth For HM International Holdings?
HM International Holdings' P/E ratio would be typical for a company that's only expected to deliver moderate growth, and importantly, perform in line with the market.
Retrospectively, the last year delivered a frustrating 12% decrease to the company's bottom line. This has erased any of its gains during the last three years, with practically no change in EPS being achieved in total. Accordingly, shareholders probably wouldn't have been overly satisfied with the unstable medium-term growth rates.
This is in contrast to the rest of the market, which is expected to grow by 22% over the next year, materially higher than the company's recent medium-term annualised growth rates.
With this information, we find it interesting that HM International Holdings is trading at a fairly similar P/E to the market. Apparently many investors in the company are less bearish than recent times would indicate and aren't willing to let go of their stock right now. They may be setting themselves up for future disappointment if the P/E falls to levels more in line with recent growth rates.
The Bottom Line On HM International Holdings' P/E
HM International Holdings' stock has a lot of momentum behind it lately, which has brought its P/E level with 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.
We've established that HM International Holdings currently trades on a higher than expected P/E since its recent three-year growth is lower than the wider market forecast. 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.
Plus, you should also learn about these 4 warning signs we've spotted with HM International Holdings (including 1 which is a bit unpleasant).
You might be able to find a better investment than HM International Holdings. If you want a selection of possible candidates, check out this free list of interesting companies that trade on a low P/E (but have proven they can grow earnings).
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尽管已经表现强劲,但HM International Holdings Limited(HKG: 8416)的股价一直在上涨,在过去三十天中上涨了29%。不幸的是,上个月的涨幅几乎没有弥补去年的亏损,在此期间,该股仍下跌了19%。
尽管价格稳步反弹,但你对HM International Holdings6.9倍的市盈率漠不关心还是可以原谅的,因为香港的市盈率(或 “市盈率”)中位数也接近9倍。但是,不加解释地忽略市盈率是不明智的,因为投资者可能无视一个特殊的机会或一个代价高昂的错误。
例如,HM International Holdings最近收益的下降值得深思。许多人可能预计,该公司将在未来一段时间内将令人失望的收益表现抛在脑后,这阻止了市盈率的下降。如果你喜欢这家公司,你至少希望情况确实如此,这样你就有可能在它不太受青睐的情况下买入一些股票。