Aehr Test Systems, Inc. (NASDAQ:AEHR) shareholders have had their patience rewarded with a 67% share price jump in the last month. But the last month did very little to improve the 65% share price decline over the last year.
Even after such a large jump in price, you could still be forgiven for feeling indifferent about Aehr Test Systems' P/E ratio of 16.3x, since the median price-to-earnings (or "P/E") ratio in the United States is also close to 18x. While this might not raise any eyebrows, if the P/E ratio is not justified investors could be missing out on a potential opportunity or ignoring looming disappointment.
Recent times have been quite advantageous for Aehr Test Systems as its earnings have been rising very briskly. It might be that many expect the strong earnings performance to wane, which has kept the P/E from rising. If you like the company, you'd be hoping this isn't the case so that you could potentially pick up some stock while it's not quite in favour.
Although there are no analyst estimates available for Aehr Test Systems, take a look at this free data-rich visualisation to see how the company stacks up on earnings, revenue and cash flow.
How Is Aehr Test Systems' Growth Trending?
There's an inherent assumption that a company should be matching the market for P/E ratios like Aehr Test Systems' to be considered reasonable.
Taking a look back first, we see that the company grew earnings per share by an impressive 120% last year. Although, its longer-term performance hasn't been as strong with three-year EPS growth being relatively non-existent overall. So it appears to us that the company has had a mixed result in terms of growing earnings over that time.
This is in contrast to the rest of the market, which is expected to grow by 14% over the next year, materially higher than the company's recent medium-term annualised growth rates.
With this information, we find it interesting that Aehr Test Systems 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 Aehr Test Systems' P/E
Aehr Test Systems' stock has a lot of momentum behind it lately, which has brought its P/E level with the market. While the price-to-earnings ratio shouldn't be the defining factor in whether you buy a stock or not, it's quite a capable barometer of earnings expectations.
We've established that Aehr Test Systems currently trades on a higher than expected P/E since its recent three-year growth is lower than the wider market forecast. When we see weak earnings with slower than market growth, we suspect the share price is at risk of declining, sending the moderate P/E lower. Unless the recent medium-term conditions improve, it's challenging to accept these prices as being reasonable.
Plus, you should also learn about these 3 warning signs we've spotted with Aehr Test Systems (including 1 which shouldn't be ignored).
If you're unsure about the strength of Aehr Test Systems' business, why not explore our interactive list of stocks with solid business fundamentals for some other companies you may have missed.
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.
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在过去的一个月里,Aehr Test Systems, Inc. (NASDAQ:AEHR)的股价上涨了67%,这让股东们的耐心得到了回报。但是过去一年,股价下跌了65%,过去一个月并没有什么改善。
即使股价大幅上涨,你可能仍然对Aehr Test Systems的市盈率16.3x感到冷淡,因为美国的中位数市盈率也接近18x。虽然这可能不会引起任何人的关注,但如果市盈率不能得到证明,投资者可能会错过潜在的机会或忽视悬而未决的失望。
最近一段时间对Aehr Test Systems来说是相当有利的,因为其盈利增长非常迅速。可能许多人认为强劲的盈利表现将会减弱,这就使市盈率没有上升。如果你喜欢这个公司,你会希望这不是事实,这样你就有可能在它还没有受欢迎的时候购买一些股票。
虽然没有Aehr Test Systems的分析师预估数据,但可以查看这个免费的数据丰富的可视化,以了解公司在盈利、营业收入和现金流方面的表现。
Aehr Test Systems的增长趋势如何?
有一个固有的假设,即Aehr Test Systems这样的公司应该与市场的市盈率相匹配,才能被认为是合理的。
这与预计在未来一年增长14%的市场形成对比,该增长率显著高于该公司最近中期年化增长率。根据这些信息,我们发现Aehr Test Systems的市盈率与市场相当相似。显然,该公司的许多投资者没有最近的看淡者想象的那么看淡,并且现在不愿放弃他们的股票。如果市盈率下降到与最近增长率更相符合的水平,他们可能正在为未来的失望做准备。
Aehr Test Systems的股票最近有很多势头,这使它的市盈率水平与市场持平。虽然市盈率不应该成为购买或不购买股票的决定性因素,但它确实是盈利预期的重要指标。我们已经确定,Aehr Test Systems目前的市盈率高于预期,因为它最近的三年增长率低于更广泛的市场预测。当我们看到弱势市盈率与缓慢的市场增长时,我们认为股价有下跌的风险,将适度的市盈率下降。除非最近的中期状况有所好转,否则很难接受这些价格是合理的。
关于Aehr Test Systems的市盈率
Aehr Test Systems的股票最近有很多势头,这使它的市盈率水平与市场持平。虽然市盈率不应该成为购买或不购买股票的决定性因素,但它确实是盈利预期的重要指标。
我们已经确定,Aehr Test Systems目前的市盈率高于预期,因为它最近的三年增长率低于更广泛的市场预测。当我们看到弱势市盈率与缓慢的市场增长时,我们认为股价有下跌的风险,将适度的市盈率下降。除非最近的中期状况有所好转,否则很难接受这些价格是合理的。此外,你还应该了解这3个警告信号,我们发现了Aehr Test Systems (包括1个不容忽视的警告信号)。
如果你不确定Aehr Test Systems业务的实力,为什么不探索我们的交互式股票清单,找出一些你可能错过的其他公司,这些公司有坚实的业务基础呢?
如果你对Aehr Test Systems业务的实力不确定,为什么不探索我们的交互式股票清单,找到一些你可能错过的其他有坚实业务基础的公司呢?