With a price-to-earnings (or "P/E") ratio of 4.7x Tsakos Energy Navigation Limited (NYSE:TEN) may be sending very bullish signals at the moment, given that almost half of all companies in the United States have P/E ratios greater than 18x and even P/E's higher than 32x are not unusual. Although, it's not wise to just take the P/E at face value as there may be an explanation why it's so limited.
Tsakos Energy Navigation has been struggling lately as its earnings have declined faster than most other companies. The P/E is probably low because investors think this poor earnings performance isn't going to improve at all. If you still like the company, you'd want its earnings trajectory to turn around before making any decisions. Or at the very least, you'd be hoping the earnings slide doesn't get any worse if your plan is to pick up some stock while it's out of favour.
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Is There Any Growth For Tsakos Energy Navigation?
There's an inherent assumption that a company should far underperform the market for P/E ratios like Tsakos Energy Navigation's to be considered reasonable.
Retrospectively, the last year delivered a frustrating 58% 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.
Turning to the outlook, the next three years should generate growth of 21% each year as estimated by the sole analyst watching the company. With the market only predicted to deliver 10% each year, the company is positioned for a stronger earnings result.
With this information, we find it odd that Tsakos Energy Navigation is trading at a P/E lower than the market. Apparently some shareholders are doubtful of the forecasts and have been accepting significantly lower selling prices.
The Bottom Line On Tsakos Energy Navigation's P/E
Generally, our preference is to limit the use of the price-to-earnings ratio to establishing what the market thinks about the overall health of a company.
We've established that Tsakos Energy Navigation currently trades on a much lower than expected P/E since its forecast growth is higher than the wider market. There could be some major unobserved threats to earnings preventing the P/E ratio from matching the positive outlook. At least price risks look to be very low, but investors seem to think future earnings could see a lot of volatility.
Plus, you should also learn about these 3 warning signs we've spotted with Tsakos Energy Navigation.
Of course, you might find a fantastic investment by looking at a few good candidates. So take a peek at this free list of companies with a strong growth track record, trading on a low P/E.
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.
纽交所股票代码为NYSE:TEN的Tsakos Energy Navigation有着4.7倍的市盈率(即“P/E”),这可能在目前发出非常积极的信号,因为美国近一半的公司市盈率大于18倍,而市盈率高于32倍并不罕见。尽管如此,仅凭市盈率来判断可能并不明智,因为它的局限性也许会有解释。
Tsakos Energy Navigation最近遭遇了困境,因为其盈利下滑速度比大多数其他公司都要快。市盈率或许之所以低是因为投资者认为这种糟糕的盈利表现不会有所改善。如果你仍然喜欢这家公司,在做出任何决策之前,你希望它的盈利走势能够扭转。或者至少,如果你计划在它不受待见的时候买入股票,你希望盈利下滑不会进一步恶化。
想要了解该公司的分析师估值报告吗?那么我们关于Tsakos Energy Navigation的免费报告将帮助您揭示未来的情况。
Tsakos Energy Navigation是否有任何增长?
有一种固有的假设,即市盈率像Tsakos Energy Navigation这样的公司,应该远远落后于市场才被认为是合理的。