IPower Inc. (NASDAQ:IPW) Shares Fly 32% But Investors Aren't Buying For Growth
IPower Inc. (NASDAQ:IPW) Shares Fly 32% But Investors Aren't Buying For Growth
The iPower Inc. (NASDAQ:IPW) share price has done very well over the last month, posting an excellent gain of 32%. Not all shareholders will be feeling jubilant, since the share price is still down a very disappointing 17% in the last twelve months.
Although its price has surged higher, when close to half the companies operating in the United States' Trade Distributors industry have price-to-sales ratios (or "P/S") above 1.3x, you may still consider iPower as an enticing stock to check out with its 0.2x P/S ratio. Although, it's not wise to just take the P/S at face value as there may be an explanation why it's limited.
What Does iPower's Recent Performance Look Like?
While the industry has experienced revenue growth lately, iPower's revenue has gone into reverse gear, which is not great. The P/S ratio is probably low because investors think this poor revenue performance isn't going to get any better. If you still 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.
Want the full picture on analyst estimates for the company? Then our free report on iPower will help you uncover what's on the horizon.What Are Revenue Growth Metrics Telling Us About The Low P/S?
The only time you'd be truly comfortable seeing a P/S as low as iPower's is when the company's growth is on track to lag the industry.
In reviewing the last year of financials, we were disheartened to see the company's revenues fell to the tune of 3.6%. Still, the latest three year period has seen an excellent 72% overall rise in revenue, in spite of its unsatisfying short-term performance. So we can start by confirming that the company has generally done a very good job of growing revenue over that time, even though it had some hiccups along the way.
Shifting to the future, estimates from the lone analyst covering the company suggest revenue growth is heading into negative territory, declining 1.0% over the next year. That's not great when the rest of the industry is expected to grow by 4.9%.
In light of this, it's understandable that iPower's P/S would sit below the majority of other companies. However, shrinking revenues are unlikely to lead to a stable P/S over the longer term. Even just maintaining these prices could be difficult to achieve as the weak outlook is weighing down the shares.
The Key Takeaway
The latest share price surge wasn't enough to lift iPower's P/S close to the industry median. Typically, we'd caution against reading too much into price-to-sales ratios when settling on investment decisions, though it can reveal plenty about what other market participants think about the company.
It's clear to see that iPower maintains its low P/S on the weakness of its forecast for sliding revenue, as expected. At this stage investors feel the potential for an improvement in revenue isn't great enough to justify a higher P/S ratio. It's hard to see the share price rising strongly in the near future under these circumstances.
Before you settle on your opinion, we've discovered 3 warning signs for iPower that you should be aware of.
It's important to make sure you look for a great company, not just the first idea you come across. So if growing profitability aligns with your idea of a great company, take a peek at this free list of interesting companies with strong recent earnings growth (and a low P/E).
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.
iPower Inc.(納斯達克股票代碼:IPW)的股價在上個月表現良好,漲幅爲32%。並非所有股東都會感到歡欣鼓舞,因爲股價在過去十二個月中仍然下跌了非常令人失望的17%。
儘管其價格飆升,但當在美國貿易分銷商行業運營的公司中,將近一半的市銷率(或 “市銷率”)高於1.3倍時,你仍然可以將iPower視爲具有0.2倍市銷率的誘人股票。但是,僅按面值計算市銷率是不明智的,因爲可以解釋其有限的原因。
iPower 最近的表現是什麼樣子?
儘管該行業最近經歷了收入增長,但iPower的收入卻倒退了,這並不好。市銷率可能很低,因爲投資者認爲這種糟糕的收入表現不會好轉。如果你仍然喜歡這家公司,你希望情況並非如此,這樣你就有可能在它失寵的時候買入一些股票。
想全面了解分析師對公司的估計嗎?然後,我們關於iPower的免費報告將幫助您發現即將發生的事情。關於低市盈率,收入增長指標告訴我們什麼?
只有當公司的增長有望落後於行業時,你才能真正放心地看到像iPower一樣低的市銷率。
在回顧去年的財務狀況時,我們沮喪地看到該公司的收入下降至3.6%。儘管如此,儘管短期表現不令人滿意,但最近三年的總體收入仍增長了72%。因此,我們可以首先確認該公司在此期間在增加收入方面總體上做得非常出色,儘管在此過程中遇到了一些小問題。
展望未來,報道該公司的唯一分析師的估計表明,收入增長將進入負值區間,明年下降1.0%。當該行業其他部門預計將增長4.9%時,這並不好。
有鑑於此,iPower的市銷率將低於其他大部分公司是可以理解的。但是,從長遠來看,收入萎縮不太可能導致市銷率穩定。由於疲軟的前景壓低了股價,即使僅僅維持這些價格也可能難以實現。
關鍵要點
最近的股價上漲不足以使iPower的市銷率接近行業中位數。通常,在做出投資決策時,我們謹慎行事,不要過多地考慮市售比率,儘管這可以揭示其他市場參與者對公司的看法。
顯而易見,iPower維持了較低的市銷率,原因是其對收入下滑的預測不如預期。在現階段,投資者認爲,收入改善的可能性不足以證明更高的市銷率是合理的。在這種情況下,很難看到股價在不久的將來強勁上漲。
在你確定自己的意見之前,我們已經發現了iPower的3個警告信號,你應該注意這些信號。
重要的是要確保你尋找一家優秀的公司,而不僅僅是你遇到的第一個想法。因此,如果盈利能力的增長與你對一家優秀公司的想法一致,那就來看看這份免費名單吧,列出了最近收益增長強勁(市盈率低)的有趣公司。
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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