B & S International Holdings Ltd. (HKG:1705) shareholders have had their patience rewarded with a 33% share price jump in the last month. Taking a wider view, although not as strong as the last month, the full year gain of 19% is also fairly reasonable.
Although its price has surged higher, B & S International Holdings may still be sending bullish signals at the moment with its price-to-earnings (or "P/E") ratio of 4.8x, 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. Nonetheless, we'd need to dig a little deeper to determine if there is a rational basis for the reduced P/E.
Earnings have risen firmly for B & S International Holdings recently, which is pleasing to see. It might be that many expect the respectable earnings performance to degrade substantially, which has repressed the P/E. 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 out of favour.
SEHK:1705 Price to Earnings Ratio vs Industry June 28th 2024 Want the full picture on earnings, revenue and cash flow for the company? Then our free report on B & S International Holdings will help you shine a light on its historical performance.
What Are Growth Metrics Telling Us About The Low P/E?
B & S International Holdings' P/E ratio would be typical for a company that's only expected to deliver limited growth, and importantly, perform worse than the market.
Retrospectively, the last year delivered an exceptional 21% gain to the company's bottom line. Pleasingly, EPS has also lifted 5,666% in aggregate from three years ago, thanks to the last 12 months of growth. Accordingly, shareholders would have probably welcomed those medium-term rates of earnings growth.
Weighing that recent medium-term earnings trajectory against the broader market's one-year forecast for expansion of 21% shows it's noticeably more attractive on an annualised basis.
In light of this, it's peculiar that B & S International Holdings' P/E sits below the majority of other companies. Apparently some shareholders believe the recent performance has exceeded its limits and have been accepting significantly lower selling prices.
What We Can Learn From B & S International Holdings' P/E?
Despite B & S International Holdings' shares building up a head of steam, its P/E still lags most other companies. We'd say the price-to-earnings ratio's power isn't primarily as a valuation instrument but rather to gauge current investor sentiment and future expectations.
We've established that B & S International Holdings currently trades on a much lower than expected P/E since its recent three-year growth is higher than the wider market forecast. There could be some major unobserved threats to earnings preventing the P/E ratio from matching this positive performance. At least price risks look to be very low if recent medium-term earnings trends continue, but investors seem to think future earnings could see a lot of volatility.
You should always think about risks. Case in point, we've spotted 2 warning signs for B & S International Holdings you should be aware of.
Of course, you might also be able to find a better stock than B & S International Holdings. So you may wish to see this free collection of other companies that have reasonable P/E ratios and have grown earnings strongly.
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B&S International Holdings Ltd.(HKG: 1705) 股东们的耐心获得了近一个月 33% 的股价上涨。更广阔的视角来看,虽然不如上个月那么强劲,但全年收益为 19%,也相当合理。
鉴于此,奇怪的是,B&S International Holdings 的市盈率低于其他公司的大部分。显然,一些股东认为最近的表现已经超出了其限制,并已接受了明显较低的出售价格。
从 B&S International Holdings 的市盈率我们可以学到什么?
尽管 B&S International Holdings 的股价已经持续上涨,但它的市盈率仍然落后于大多数其他公司。我们认为,市盈率的主要作用不是作为估值工具,而是为了评估当前的投资者情绪和未来的预期。
我们已经确定,B&S International Holdings 目前的市盈率要低得多,因为它最近三年的增长高于更广泛的市场预测。阻止市盈率与这种正面表现相匹配的可能存在一些重大未观察到的收益威胁。如果最近中期的收益趋势继续,至少价格风险看起来非常低,但投资者似乎认为未来的收益可能会出现很大的波动。
你应该始终考虑风险。例如,我们已经发现 B&S International Holdings 的 2 个警告信号,你应该意识到这些风险。
当然,你可能会找到比 B&S International Holdings 更好的股票。因此,你可能希望查看这些市盈率合理且收益增长强劲的其他公司的免费集合。