Bandwidth Inc. (NASDAQ:BAND) shares have had a horrible month, losing 26% after a relatively good period beforehand. Looking back over the past twelve months the stock has been a solid performer regardless, with a gain of 25%.
Although its price has dipped substantially, there still wouldn't be many who think Bandwidth's price-to-sales (or "P/S") ratio of 0.7x is worth a mention when the median P/S in the United States' Telecom industry is similar at about 1.2x. However, investors might be overlooking a clear opportunity or potential setback if there is no rational basis for the P/S.
NasdaqGS:BAND Price to Sales Ratio vs Industry June 22nd 2024
What Does Bandwidth's P/S Mean For Shareholders?
Bandwidth certainly has been doing a good job lately as its revenue growth has been positive while most other companies have been seeing their revenue go backwards. Perhaps the market is expecting its current strong performance to taper off in accordance to the rest of the industry, which has kept the P/S contained. If not, then existing shareholders have reason to be feeling optimistic about the future direction of the share price.
Want the full picture on analyst estimates for the company? Then our free report on Bandwidth will help you uncover what's on the horizon.
Is There Some Revenue Growth Forecasted For Bandwidth?
The only time you'd be comfortable seeing a P/S like Bandwidth's is when the company's growth is tracking the industry closely.
Retrospectively, the last year delivered a decent 9.4% gain to the company's revenues. This was backed up an excellent period prior to see revenue up by 63% in total over the last three years. So we can start by confirming that the company has done a great job of growing revenues over that time.
Turning to the outlook, the next year should generate growth of 14% as estimated by the eight analysts watching the company. With the industry predicted to deliver 89% growth, the company is positioned for a weaker revenue result.
With this in mind, we find it intriguing that Bandwidth's P/S is closely matching its industry peers. Apparently many investors in the company are less bearish than analysts indicate and aren't willing to let go of their stock right now. Maintaining these prices will be difficult to achieve as this level of revenue growth is likely to weigh down the shares eventually.
The Final Word
Bandwidth's plummeting stock price has brought its P/S back to a similar region as the rest of the industry. While the price-to-sales ratio shouldn't be the defining factor in whether you buy a stock or not, it's quite a capable barometer of revenue expectations.
When you consider that Bandwidth's revenue growth estimates are fairly muted compared to the broader industry, it's easy to see why we consider it unexpected to be trading at its current P/S ratio. At present, we aren't confident in the P/S as the predicted future revenues aren't likely to support a more positive sentiment for long. This places shareholders' investments at risk and potential investors in danger of paying an unnecessary premium.
We don't want to rain on the parade too much, but we did also find 3 warning signs for Bandwidth that you need to be mindful of.
If these risks are making you reconsider your opinion on Bandwidth, explore our interactive list of high quality stocks to get an idea of what else is out there.
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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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Bandwidth Inc. (納斯達克股票代碼:BAND)的股價在經歷了之前相對較好的時期後,本月下跌了26%,表現十分糟糕。回顧過去的十二個月,無論如何,該股表現良好,漲幅爲25%。
儘管其價格已大幅下跌,但當美國電信行業的市盈率中位數約爲1.2倍時,仍不會有多少人認爲Bandwidth的0.7倍市銷率(或 “市盈率”)值得一提。但是,如果市銷率沒有合理的基礎,投資者可能會忽略明顯的機會或潛在的挫折。
納斯達克GS: BAND 與行業的股價銷售比率 2024 年 6 月 22 日
Bandwidth的市銷率對股東意味着什麼?
Bandwidth最近確實做得很好,因爲其收入增長是正的,而大多數其他公司的收入卻在倒退。也許市場預計其目前的強勁表現將像行業其他部門一樣逐漸減弱,這使市銷售率保持在控制範圍內。如果不是,那麼現有股東就有理由對股價的未來走向感到樂觀。
想全面了解分析師對公司的估計嗎?然後,我們的免費帶寬報告將幫助您發現即將發生的事情。
預計Bandwidth的收入會增長嗎?
只有當公司的增長密切關注行業時,你才能放心地看到像Bandwidth這樣的市銷率。
回顧過去,去年的公司收入實現了9.4%的可觀增長。在過去三年中,總收入增長了63%,此前這是一個很好的時期。因此,我們可以首先確認該公司在此期間在增加收入方面做得很好。
談到前景,根據關注該公司的八位分析師的估計,明年將實現14%的增長。預計該行業將實現89%的增長,因此該公司的收入業績將疲軟。
考慮到這一點,我們發現帶寬的市銷率與業內同行非常接近,這很有趣。顯然,該公司的許多投資者沒有分析師所表示的那麼看跌,並且不願意立即放棄股票。維持這些價格將很難實現,因爲這種收入增長水平最終可能會壓低股價。
最後一句話
Bandwidth的股價暴跌使其市銷率回到了與該行業其他公司相似的區域。儘管市銷率不應該成爲決定你是否買入股票的決定性因素,但它是衡量收入預期的有力晴雨表。
當你考慮到與整個行業相比,Bandwidth的收入增長預期相當低時,不難理解我們爲何認爲以目前的市銷率進行交易是出乎意料的。目前,我們對市銷率沒有信心,因爲預期的未來收入不太可能長期支撐更積極的情緒。這使股東的投資處於風險之中,潛在投資者面臨支付不必要的溢價的危險。
我們不想在遊行隊伍中下太多雨,但我們也發現了 3 個需要注意的帶寬警告標誌。
如果這些風險讓你重新考慮你對帶寬的看法,請瀏覽我們的高質量股票互動清單,了解還有什麼。
對這篇文章有反饋嗎?對內容感到擔憂嗎?請直接聯繫我們。或者,也可以發送電子郵件至編輯團隊 (at) simplywallst.com。
Simply Wall St的這篇文章本質上是籠統的。我們僅使用公正的方法根據歷史數據和分析師的預測提供評論,我們的文章無意作爲財務建議。它不構成買入或賣出任何股票的建議,也沒有考慮到您的目標或財務狀況。我們的目標是爲您提供由基本數據驅動的長期重點分析。請注意,我們的分析可能不考慮最新的價格敏感型公司公告或定性材料。簡而言之,華爾街沒有持有任何上述股票的頭寸。
對這篇文章有反饋嗎?擔心內容嗎?直接聯繫我們。或者,發送電子郵件至 editorial-team@simplywallst.com