Golden Faith Group Holdings Limited (HKG:2863) shares have continued their recent momentum with a 30% gain in the last month alone. The bad news is that even after the stocks recovery in the last 30 days, shareholders are still underwater by about 5.5% over the last year.
Even after such a large jump in price, there still wouldn't be many who think Golden Faith Group Holdings' price-to-sales (or "P/S") ratio of 0.3x is worth a mention when it essentially matches the median P/S in Hong Kong's Construction industry. However, investors might be overlooking a clear opportunity or potential setback if there is no rational basis for the P/S.
Check out our latest analysis for Golden Faith Group Holdings
SEHK:2863 Price to Sales Ratio vs Industry December 29th 2023
How Has Golden Faith Group Holdings Performed Recently?
With revenue growth that's exceedingly strong of late, Golden Faith Group Holdings has been doing very well. Perhaps the market is expecting future revenue performance to taper off, which has kept the P/S 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.
We don't have analyst forecasts, but you can see how recent trends are setting up the company for the future by checking out our free report on Golden Faith Group Holdings' earnings, revenue and cash flow.
How Is Golden Faith Group Holdings' Revenue Growth Trending?
There's an inherent assumption that a company should be matching the industry for P/S ratios like Golden Faith Group Holdings' to be considered reasonable.
If we review the last year of revenue growth, the company posted a terrific increase of 93%. Pleasingly, revenue has also lifted 175% in aggregate from three years ago, thanks to the last 12 months of growth. So we can start by confirming that the company has done a great job of growing revenue over that time.
When compared to the industry's one-year growth forecast of 12%, the most recent medium-term revenue trajectory is noticeably more alluring
In light of this, it's curious that Golden Faith Group Holdings' P/S sits in line with the majority of other companies. Apparently some shareholders believe the recent performance is at its limits and have been accepting lower selling prices.
What We Can Learn From Golden Faith Group Holdings' P/S?
Its shares have lifted substantially and now Golden Faith Group Holdings' P/S is back within range of the industry median. 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.
To our surprise, Golden Faith Group Holdings revealed its three-year revenue trends aren't contributing to its P/S as much as we would have predicted, given they look better than current industry expectations. It'd be fair to assume that potential risks the company faces could be the contributing factor to the lower than expected P/S. While recent revenue trends over the past medium-term suggest that the risk of a price decline is low, investors appear to see the likelihood of revenue fluctuations in the future.
Don't forget that there may be other risks. For instance, we've identified 2 warning signs for Golden Faith Group Holdings (1 is a bit unpleasant) you should be aware of.
If you're unsure about the strength of Golden Faith Group Holdings' 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.
有鑑於此,奇怪的是,Golden Faith Group Holdings的市銷率與其他多數公司持平。顯然,一些股東認爲最近的表現已達到極限,並一直在接受較低的銷售價格。
我們可以從Golden Faith Group Holdings的市銷率中學到什麼?
其股價已大幅上漲,現在Golden Faith Group Holdings的市銷率已恢復在行業中位數範圍內。僅使用市銷率來確定是否應該出售股票是不明智的,但它可以作爲公司未來前景的實用指南。
令我們驚訝的是,Golden Faith Group Holdings透露,其三年收入趨勢對市銷率的貢獻沒有我們預期的那麼大,因爲這些趨勢看起來好於當前的行業預期。可以公平地假設,公司面臨的潛在風險可能是導致市銷率低於預期的因素。儘管最近中期的收入趨勢表明價格下跌的風險很低,但投資者似乎看到了未來收入波動的可能性。
別忘了可能還有其他風險。例如,我們已經確定了Golden Faith Group Holdings的兩個警告信號(其中一個有點不愉快),你應該注意。
如果您不確定Golden Faith Group Holdings的業務實力,爲什麼不瀏覽我們的互動式股票清單,其中列出了一些您可能錯過的其他公司,這些股票具有穩健的業務基本面。
對這篇文章有反饋嗎?對內容感到擔憂?直接聯繫我們。 或者,給編輯團隊 (at) simplywallst.com 發送電子郵件。 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提供基於歷史數據和分析師預測的評論,我們的文章並非旨在提供財務建議。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,我們的分析可能不會考慮最新的價格敏感型公司公告或定性材料。華爾街只是沒有持有上述任何股票的頭寸。