Gorilla Technology Group Inc. (NASDAQ:GRRR) Soars 80% But It's A Story Of Risk Vs Reward
Gorilla Technology Group Inc. (NASDAQ:GRRR) Soars 80% But It's A Story Of Risk Vs Reward
Gorilla Technology Group Inc. (NASDAQ:GRRR) shareholders would be excited to see that the share price has had a great month, posting a 80% gain and recovering from prior weakness. But the last month did very little to improve the 87% share price decline over the last year.
In spite of the firm bounce in price, Gorilla Technology Group may still be sending very bullish signals at the moment with its price-to-sales (or "P/S") ratio of 1.6x, since almost half of all companies in the Software industry in the United States have P/S ratios greater than 4.3x and even P/S higher than 12x are not unusual. Although, it's not wise to just take the P/S at face value as there may be an explanation why it's so limited.
What Does Gorilla Technology Group's Recent Performance Look Like?
Gorilla Technology Group certainly has been doing a good job lately as it's been growing revenue more than most other companies. It might be that many expect the strong revenue performance to degrade substantially, which has repressed the share price, and thus the P/S ratio. If not, then existing shareholders have reason to be quite optimistic about the future direction of the share price.
Want the full picture on analyst estimates for the company? Then our free report on Gorilla Technology Group will help you uncover what's on the horizon.What Are Revenue Growth Metrics Telling Us About The Low P/S?
In order to justify its P/S ratio, Gorilla Technology Group would need to produce anemic growth that's substantially trailing the industry.
Retrospectively, the last year delivered an exceptional 31% gain to the company's top line. However, this wasn't enough as the latest three year period has seen the company endure a nasty 7.8% drop in revenue in aggregate. So unfortunately, we have to acknowledge that the company has not done a great job of growing revenues over that time.
Shifting to the future, estimates from the three analysts covering the company suggest revenue should grow by 93% over the next year. With the industry only predicted to deliver 15%, the company is positioned for a stronger revenue result.
With this information, we find it odd that Gorilla Technology Group is trading at a P/S lower than the industry. It looks like most investors are not convinced at all that the company can achieve future growth expectations.
The Final Word
Even after such a strong price move, Gorilla Technology Group's P/S still trails the rest of the industry. 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.
A look at Gorilla Technology Group's revenues reveals that, despite glowing future growth forecasts, its P/S is much lower than we'd expect. The reason for this depressed P/S could potentially be found in the risks the market is pricing in. It appears the market could be anticipating revenue instability, because these conditions should normally provide a boost to the share price.
It's always necessary to consider the ever-present spectre of investment risk. We've identified 5 warning signs with Gorilla Technology Group (at least 2 which shouldn't be ignored), and understanding them should be part of your investment process.
If strong companies turning a profit tickle your fancy, then you'll want to check out this free list of interesting companies that trade on a low P/E (but have proven they can grow earnings).
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.
大猩猩科技集團公司(納斯達克股票代碼:GRRR)的股東們會很高興看到股價經歷了一個不錯的月份,上漲了80%,並從先前的疲軟中恢復過來。但是上個月幾乎沒有改善去年股價下跌87%的局面。
儘管價格穩步反彈,但大猩猩科技集團目前可能仍在發出非常看漲的信號,其市銷率(或 “市盈率”)爲1.6倍,因爲美國軟件行業幾乎有一半公司的市盈率大於4.3倍,甚至市盈率高於12倍的情況並不少見。但是,僅按面值計算市銷率是不明智的,因爲可以解釋其爲何如此有限。
大猩猩科技集團最近的表現如何?
大猩猩科技集團最近確實做得很好,因爲它的收入增長幅度超過了大多數其他公司。許多人可能預計,強勁的收入表現將大幅下降,這抑制了股價,從而抑制了市銷率。如果不是,那麼現有股東就有理由對股價的未來走向非常樂觀。
想全面了解分析師對公司的估計嗎?然後,我們關於大猩猩科技集團的免費報告將幫助您發現即將發生的事情。收入增長指標告訴我們低市銷率有哪些?
爲了證明其市銷率是合理的,大猩猩科技集團需要實現大幅落後於該行業的疲軟增長。
回顧過去,去年的公司收入實現了31%的驚人增長。但是,這還不夠,因爲在最近三年中,該公司的總收入下降了7.8%。因此,不幸的是,我們必須承認,在這段時間內,該公司在增加收入方面做得不好。
展望未來,報道該公司的三位分析師的估計表明,明年收入將增長93%。由於預計該行業的收入僅爲15%,該公司有望實現更強勁的收入業績。
有了這些信息,我們覺得奇怪的是,大猩猩科技集團的市銷售率低於該行業。看來大多數投資者根本不相信公司能夠實現未來的增長預期。
最後一句話
即使在價格走勢如此強勁之後,大猩猩科技集團的市銷率仍落後於該行業的其他公司。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。
縱觀大猩猩科技集團的收入,就會發現,儘管未來增長預測樂觀,但其市銷率遠低於我們的預期。市銷率低迷的原因可能在於市場定價的風險。看來市場可能會預期收入不穩定,因爲這些條件通常會提振股價。
始終有必要考慮永遠存在的投資風險幽靈。我們已經向大猩猩科技集團確定了5個警告信號(至少有2個不容忽視),了解它們應該是您投資過程的一部分。
如果你喜歡實力雄厚的公司盈利,那麼你會想看看這份以低市盈率(但已證明可以增加收益)的有趣公司的免費名單。
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根據歷史數據和分析師的預測提供評論,我們的文章無意作爲財務建議。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,我們的分析可能不考慮最新的價格敏感型公司公告或定性材料。簡而言之,華爾街沒有持有任何上述股票的頭寸。
譯文內容由第三人軟體翻譯。
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