The Manitex International, Inc. (NASDAQ:MNTX) share price has fared very poorly over the last month, falling by a substantial 28%. The recent drop has obliterated the annual return, with the share price now down 4.3% over that longer period.

After such a large drop in price, considering around half the companies operating in the United States' Machinery industry have price-to-sales ratios (or "P/S") above 1.5x, you may consider Manitex International as an solid investment opportunity with its 0.3x P/S ratio. Nonetheless, we'd need to dig a little deeper to determine if there is a rational basis for the reduced P/S.

What Does Manitex International's Recent Performance Look Like?

Manitex International could be doing better as it's been growing revenue less than most other companies lately. Perhaps the market is expecting the current trend of poor revenue growth to continue, which has kept the P/S suppressed. If this is the case, then existing shareholders will probably struggle to get excited about the future direction of the share price.

How Is Manitex International's Revenue Growth Trending?

The only time you'd be truly comfortable seeing a P/S as low as Manitex International's is when the company's growth is on track to lag the industry.

Retrospectively, the last year delivered a decent 5.5% gain to the company's revenues. Pleasingly, revenue has also lifted 79% in aggregate from three years ago, partly thanks to the last 12 months of growth. So we can start by confirming that the company has done a great job of growing revenues over that time.

Looking ahead now, revenue is anticipated to climb by 5.5% per annum during the coming three years according to the dual analysts following the company. That's shaping up to be similar to the 5.2% per annum growth forecast for the broader industry.

With this information, we find it odd that Manitex International is trading at a P/S lower than the industry. Apparently some shareholders are doubtful of the forecasts and have been accepting lower selling prices.

The Bottom Line On Manitex International's P/S

The southerly movements of Manitex International's shares means its P/S is now sitting at a pretty low level. Using the price-to-sales 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 seen that Manitex International currently trades on a lower than expected P/S since its forecast growth is in line with the wider industry. Despite average revenue growth estimates, there could be some unobserved threats keeping the P/S low. However, if you agree with the analysts' forecasts, you may be able to pick up the stock at an attractive price.

Having said that, be aware Manitex International is showing 3 warning signs in our investment analysis, and 1 of those can't be ignored.

If you're unsure about the strength of Manitex International's business, why not explore our interactive list of stocks with solid business fundamentals for some other companies you may have missed.

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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.

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