The low P/S ratio may be due to expectations of continued or accelerated revenue decline. However, if this does not occur, existing shareholders may be optimistic about the future direction of the share price. The company's revenue growth is underperforming the industry, which is expected to expand by 60% in the next year. This, along with the company's declining revenue, may be contributing to the low P/S ratio and the drop in share price.
Shenzhen Deren Electronic's EBIT loss of CN¥190m and CN¥766m negative free cash flow cast it as a risky investment. Careful monitoring of its future growth and debt covering ability is advised.
Shenzhen Deren Electronic Stock Forum
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