SurgePays, Inc.'s (NASDAQ:SURG) 44% Share Price Plunge Could Signal Some Risk
SurgePays, Inc.'s (NASDAQ:SURG) 44% Share Price Plunge Could Signal Some Risk
SurgePays, Inc. (NASDAQ:SURG) shares have had a horrible month, losing 44% after a relatively good period beforehand. Looking back over the past twelve months the stock has been a solid performer regardless, with a gain of 25%.
Although its price has dipped substantially, there still wouldn't be many who think SurgePays' price-to-sales (or "P/S") ratio of 0.7x is worth a mention when it essentially matches the median P/S in the United States' Wireless Telecom industry. Although, it's not wise to simply ignore the P/S without explanation as investors may be disregarding a distinct opportunity or a costly mistake.
How SurgePays Has Been Performing
SurgePays certainly has been doing a good job lately as it's been growing revenue more than most other companies. One possibility is that the P/S ratio is moderate because investors think this strong revenue performance might be about to tail off. 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 not quite in favour.
If you'd like to see what analysts are forecasting going forward, you should check out our free report on SurgePays.How Is SurgePays' Revenue Growth Trending?
SurgePays' P/S ratio would be typical for a company that's only expected to deliver moderate growth, and importantly, perform in line with the industry.
Retrospectively, the last year delivered a decent 13% gain to the company's revenues. The latest three year period has also seen an excellent 152% overall rise in revenue, aided somewhat by its short-term performance. Therefore, it's fair to say the revenue growth recently has been superb for the company.
Turning to the outlook, the next year should bring diminished returns, with revenue decreasing 5.7% as estimated by the lone analyst watching the company. With the industry predicted to deliver 2.9% growth, that's a disappointing outcome.
With this information, we find it concerning that SurgePays is trading at a fairly similar P/S compared to the industry. Apparently many investors in the company reject the analyst cohort's pessimism and aren't willing to let go of their stock right now. Only the boldest would assume these prices are sustainable as these declining revenues are likely to weigh on the share price eventually.
The Final Word
With its share price dropping off a cliff, the P/S for SurgePays looks to be in line with the rest of the Wireless Telecom industry. It's argued the price-to-sales ratio is an inferior measure of value within certain industries, but it can be a powerful business sentiment indicator.
While SurgePays' P/S isn't anything out of the ordinary for companies in the industry, we didn't expect it given forecasts of revenue decline. When we see a gloomy outlook like this, our immediate thoughts are that the share price is at risk of declining, negatively impacting P/S. If the poor revenue outlook tells us one thing, it's that these current price levels could be unsustainable.
Before you settle on your opinion, we've discovered 3 warning signs for SurgePays (1 is significant!) that you should be aware of.
If you're unsure about the strength of SurgePays' business, why not explore our interactive list of stocks with solid business fundamentals for some other companies you may have missed.
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.
SurgePays, Inc.(納斯達克股票代碼:SURG)的股價經歷了一個糟糕的月份,在經歷了相對不錯的時期之後下跌了44%。回顧過去的十二個月,無論如何,該股表現良好,漲幅爲25%。
儘管其價格已大幅下跌,但仍然沒有多少人認爲SurgePays的0.7倍市銷率(或 “市盈率”)值得一提,因爲它與美國無線電信行業的市盈率中位數基本相當。但是,不加解釋地忽略市銷率是不明智的,因爲投資者可能會忽視一個明顯的機會或一個代價高昂的錯誤。
SurgePays 的表現如何
SurgePays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。一種可能性是市銷率適中,因爲投資者認爲這種強勁的收入表現可能即將結束。如果你喜歡這家公司,你希望情況並非如此,這樣你就有可能在它不太受青睞的情況下買入一些股票。
如果你想了解分析師對未來的預測,你應該查看我們關於SurgePays的免費報告。SurgePays 的收入增長趨勢如何?
SurgePays的市銷率對於一家預計只會實現適度增長且重要的是表現與行業持平的公司來說是典型的。
回顧過去,去年的公司收入實現了13%的可觀增長。在最近三年中,總收入也實現了152%的出色增長,這在一定程度上得益於其短期表現。因此,可以公平地說,該公司最近的收入增長非常好。
談到前景,明年的回報應該會減少,根據唯一關注該公司的分析師的估計,收入將下降5.7%。預計該行業將實現2.9%的增長,這是一個令人失望的結果。
有了這些信息,我們發現與行業相比,SurgePays的交易市銷率相當相似。顯然,該公司的許多投資者拒絕了分析師群體的悲觀情緒,並且不願意立即放棄股票。只有最大膽的人才會假設這些價格是可持續的,因爲這些收入的下降最終可能會壓制股價。
最後一句話
隨着股價的下跌,SurgePays的市銷率似乎與無線電信行業的其他公司持平。有人認爲,在某些行業中,市銷率是衡量價值的較差指標,但它可以是一個有力的商業信心指標。
儘管對於該行業的公司而言,SurgePays的市銷率並不罕見,但鑑於收入下降的預測,我們並沒有預料到這一點。當我們看到這樣的悲觀前景時,我們立即想到的是股價有下跌的風險,對市銷率產生負面影響。如果糟糕的收入前景告訴我們一件事,那就是當前的價格水平可能是不可持續的。
在你確定自己的意見之前,我們已經發現了 SurgePays 的 3 個警告信號(1 個很重要!)你應該注意的。
如果您不確定SurgePays的業務實力,爲什麼不瀏覽我們的互動式股票清單,其中列出了一些您可能錯過的其他公司,這些股票具有穩健的業務基本面。
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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