S-Enjoy Service Group Co., Limited (HKG:1755) shares have had a really impressive month, gaining 27% after a shaky period beforehand. Not all shareholders will be feeling jubilant, since the share price is still down a very disappointing 41% in the last twelve months.
Even after such a large jump in price, S-Enjoy Service Group may still be sending bullish signals at the moment with its price-to-earnings (or "P/E") ratio of 5.2x, since almost half of all companies in Hong Kong have P/E ratios greater than 10x and even P/E's higher than 19x are not unusual. However, the P/E might be low for a reason and it requires further investigation to determine if it's justified.
Recent times have been advantageous for S-Enjoy Service Group as its earnings have been rising faster than most other companies. It might be that many expect the strong earnings performance to degrade substantially, which has repressed the P/E. If not, then existing shareholders have reason to be quite optimistic about the future direction of the share price.
SEHK:1755 Price to Earnings Ratio vs Industry April 26th 2024 If you'd like to see what analysts are forecasting going forward, you should check out our free report on S-Enjoy Service Group.
How Is S-Enjoy Service Group's Growth Trending?
The only time you'd be truly comfortable seeing a P/E as low as S-Enjoy Service Group's is when the company's growth is on track to lag the market.
Taking a look back first, we see that the company managed to grow earnings per share by a handy 4.9% last year. Still, lamentably EPS has fallen 7.6% in aggregate from three years ago, which is disappointing. Therefore, it's fair to say the earnings growth recently has been undesirable for the company.
Turning to the outlook, the next three years should generate growth of 8.7% per annum as estimated by the nine analysts watching the company. Meanwhile, the rest of the market is forecast to expand by 15% each year, which is noticeably more attractive.
With this information, we can see why S-Enjoy Service Group is trading at a P/E lower than the market. It seems most investors are expecting to see limited future growth and are only willing to pay a reduced amount for the stock.
The Key Takeaway
Despite S-Enjoy Service Group's shares building up a head of steam, its P/E still lags most other companies. Using the price-to-earnings 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.
As we suspected, our examination of S-Enjoy Service Group's analyst forecasts revealed that its inferior earnings outlook is contributing to its low P/E. Right now shareholders are accepting the low P/E as they concede future earnings probably won't provide any pleasant surprises. It's hard to see the share price rising strongly in the near future under these circumstances.
There are also other vital risk factors to consider before investing and we've discovered 1 warning sign for S-Enjoy Service Group that you should be aware of.
If these risks are making you reconsider your opinion on S-Enjoy Service Group, explore our interactive list of high quality stocks to get an idea of what else is out there.
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S-Enjoy Service Group Co., Limited(HKG: 1755)的股价经历了一个非常令人印象深刻的月份,在经历了动荡时期之后上涨了27%。并非所有股东都会感到欢欣鼓舞,因为股价在过去十二个月中仍然下跌了令人失望的41%。
即使在价格大幅上涨之后,S-Enjoy Service Group目前仍可能以5.2倍的市盈率(或 “市盈率”)发出看涨信号,因为几乎一半的香港公司的市盈率大于10倍,甚至市盈率高于19倍也并不罕见。但是,市盈率之低可能是有原因的,需要进一步调查以确定其是否合理。
最近对S-Enjoy Service Group来说是有利的,因为其收益增长速度快于大多数其他公司。许多人可能预计强劲的盈利表现将大幅下滑,这抑制了市盈率。如果不是,那么现有股东有理由对股价的未来走向持相当乐观的态度。