Unfortunately for some shareholders, the Esports Entertainment Group, Inc. (NASDAQ:GMBL) share price has dived 36% in the last thirty days, prolonging recent pain. The recent drop completes a disastrous twelve months for shareholders, who are sitting on a 100% loss during that time.
Following the heavy fall in price, when close to half the companies operating in the United States' Hospitality industry have price-to-sales ratios (or "P/S") above 1.3x, you may consider Esports Entertainment Group as an enticing stock to check out with its 0.1x 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.
NasdaqCM:GMBL Price to Sales Ratio vs Industry February 14th 2024
What Does Esports Entertainment Group's Recent Performance Look Like?
For example, consider that Esports Entertainment Group's financial performance has been poor lately as its revenue has been in decline. One possibility is that the P/S is low because investors think the company won't do enough to avoid underperforming the broader industry in the near future. However, if this doesn't eventuate then existing shareholders may be feeling optimistic about the future direction of the share price.
Want the full picture on earnings, revenue and cash flow for the company? Then our free report on Esports Entertainment Group will help you shine a light on its historical performance.
What Are Revenue Growth Metrics Telling Us About The Low P/S?
In order to justify its P/S ratio, Esports Entertainment Group would need to produce sluggish growth that's trailing the industry.
Retrospectively, the last year delivered a frustrating 69% decrease to the company's top line. Spectacularly, three year revenue growth has ballooned by several orders of magnitude, despite the drawbacks experienced in the last 12 months. Therefore, it's fair to say the revenue growth recently has been superb for the company, but investors will want to ask why it is now in decline.
Comparing that recent medium-term revenue trajectory with the industry's one-year growth forecast of 15% shows it's noticeably more attractive.
With this information, we find it odd that Esports Entertainment Group is trading at a P/S lower than the industry. Apparently some shareholders believe the recent performance has exceeded its limits and have been accepting significantly lower selling prices.
What Does Esports Entertainment Group's P/S Mean For Investors?
Esports Entertainment Group's recently weak share price has pulled its P/S back below other Hospitality companies. 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.
We're very surprised to see Esports Entertainment Group currently trading on a much lower than expected P/S since its recent three-year growth is higher than the wider industry forecast. Potential investors that are sceptical over continued revenue performance may be preventing the P/S ratio from matching previous strong performance. At least price risks look to be very low if recent medium-term revenue trends continue, but investors seem to think future revenue could see a lot of volatility.
Before you take the next step, you should know about the 5 warning signs for Esports Entertainment Group that we have uncovered.
If strong companies turning a profit tickle your fancy, then you'll want to check out this free list of interesting companies that trade on a low P/E (but have proven they can grow earnings).
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.
残念ながら、株主の一部にとって、Esports Entertainment Group、Inc.(NASDAQ:GMBL)の株価は過去30日間で36%下落し、最近の苦痛を長引かせています。最近の下落は、株主にとって惨憺たる12か月間を完結させ、その期間中の損失率は100%です。
価格の大幅な下落に続いて、米国のホスピタリティ業界で半数近くの企業が販売価格比率(または「P / S」)が1.3倍以上であり、その0.1倍のP / S比率を持つEsports Entertainment Groupは魅力的な株式と見なされる可能性があります。しかし、低下したP / Sの合理的な根拠があるかどうかを確認するために、少し深く掘り下げる必要があります。
NasdaqCM:GMBL株価対売上高比率vs業種2024年2月14日
Esports Entertainment Groupの最近のパフォーマンスはどのようになっていますか?
例えば、 Esports Entertainment Groupの財務パフォーマンスが最近低迷しており、売上高が減少していることを考えると、P / Sが低いのは、投資家が今後の広範な業種の性能に追いつくのに十分な努力をしないと考えているためです。ただし、これが実現しない場合、既存の株主は株価の将来方向に楽観的な気分になっている可能性があります。
会社の収益、売上高、キャッシュフローについての完全な情報を知りたい場合は、Esports Entertainment Groupの無料レポートを使用して、その過去のパフォーマンスを調べることができます。
低いP / Sについて、収益成長メトリックスは何を教えてくれていますか?
P / S比率を正当化するには、Esports Entertainment Groupは業界を下回る低調な成長を生み出さなければなりません。
オーストラリアでは、moomooの投資商品及びサービスはMoomoo Securities Australia Limitedによって提供され、オーストラリア証券投資委員会(ASIC)の管理を受けております(AFSL No. 224663)。「金融サービスガイド」、「利用規約」、「プライバシーポリシー」などの詳細は、Moomoo Securities Australia Limitedのウェブサイトhttps://www.moomoo.com/auでご確認いただけます。
オーストラリアでは、moomooの投資商品及びサービスはMoomoo Securities Australia Limitedによって提供され、オーストラリア証券投資委員会(ASIC)の管理を受けております(AFSL No. 224663)。「金融サービスガイド」、「利用規約」、「プライバシーポリシー」などの詳細は、Moomoo Securities Australia Limitedのウェブサイトhttps://www.moomoo.com/auでご確認いただけます。