Despite a drop in ROCE, the rise in revenue and assets, coupled with a decrease in liabilities, may signal positive long-term stock performance. The stock has yielded a substantial 66% return to shareholders over the past three years, suggesting investors are acknowledging these encouraging trends.
Despite retaining most profits, the low ROE and lack of earnings growth suggest investors may not benefit from this reinvestment. Caution is advised when considering this company, due to its risk profile.
Investor expectations of limited future growth may be causing a lower P/S ratio for Shanghai Newtouch Software. The company's lower forecast growth compared to the wider industry seems to be contributing to this. A change in the company's fortunes would be needed to justify a higher P/S ratio in the future.
Shanghai Newtouch Software Stock Forum
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