Risks To Shareholder Returns Are Elevated At These Prices For Cohu, Inc. (NASDAQ:COHU)
Risks To Shareholder Returns Are Elevated At These Prices For Cohu, Inc. (NASDAQ:COHU)
With a price-to-earnings (or "P/E") ratio of 51.1x Cohu, Inc. (NASDAQ:COHU) may be sending very bearish signals at the moment, given that almost half of all companies in the United States have P/E ratios under 16x and even P/E's lower than 9x are not unusual. Nonetheless, we'd need to dig a little deeper to determine if there is a rational basis for the highly elevated P/E.
Cohu has been struggling lately as its earnings have declined faster than most other companies. One possibility is that the P/E is high because investors think the company will turn things around completely and accelerate past most others in the market. If not, then existing shareholders may be very nervous about the viability of the share price.
Want the full picture on analyst estimates for the company? Then our free report on Cohu will help you uncover what's on the horizon.How Is Cohu's Growth Trending?
In order to justify its P/E ratio, Cohu would need to produce outstanding growth well in excess of the market.
If we review the last year of earnings, dishearteningly the company's profits fell to the tune of 70%. At least EPS has managed not to go completely backwards from three years ago in aggregate, thanks to the earlier period of growth. Accordingly, shareholders probably wouldn't have been overly satisfied with the unstable medium-term growth rates.
Looking ahead now, EPS is anticipated to slump, contracting by 207% during the coming year according to the seven analysts following the company. With the market predicted to deliver 11% growth , that's a disappointing outcome.
With this information, we find it concerning that Cohu is trading at a P/E higher than the market. It seems most investors are hoping for a turnaround in the company's business prospects, but the analyst cohort is not so confident this will happen. There's a very good chance these shareholders are setting themselves up for future disappointment if the P/E falls to levels more in line with the negative growth outlook.
The Key Takeaway
Generally, our preference is to limit the use of the price-to-earnings ratio to establishing what the market thinks about the overall health of a company.
Our examination of Cohu's analyst forecasts revealed that its outlook for shrinking earnings isn't impacting its high P/E anywhere near as much as we would have predicted. When we see a poor outlook with earnings heading backwards, we suspect the share price is at risk of declining, sending the high P/E lower. This places shareholders' investments at significant risk and potential investors in danger of paying an excessive premium.
Before you settle on your opinion, we've discovered 2 warning signs for Cohu (1 is concerning!) that you should be aware of.
You might be able to find a better investment than Cohu. If you want a selection of possible candidates, 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.
Cohu, Inc.(納斯達克股票代碼:COHU)的市盈率(或 “市盈率”)爲51.1倍,目前可能會發出非常看跌的信號,因爲美國幾乎有一半的公司的市盈率低於16倍,甚至市盈率低於9倍也並不罕見。儘管如此,我們需要更深入地挖掘,以確定市盈率大幅上漲是否有合理的基礎。
由於其收益的下降速度快於大多數其他公司,Cohu最近一直在苦苦掙扎。一種可能性是市盈率居高不下,因爲投資者認爲該公司將徹底扭轉局面,加速超越市場上的大多數其他公司。如果不是,那麼現有股東可能會對股價的可行性感到非常擔憂。
想全面了解分析師對公司的估計嗎?然後,我們關於Cohu的免費報告將幫助您發現即將發生的事情。Cohu 的增長趨勢如何?
爲了證明其市盈率是合理的,Cohu需要實現遠遠超過市場的出色增長。
如果我們回顧一下去年的收益,令人沮喪的是,該公司的利潤下降了70%。由於較早的增長期,至少每股收益總體上沒有與三年前相比完全倒退。因此,股東們可能不會對不穩定的中期增長率過於滿意。
展望未來,預計每股收益將下滑,根據關注該公司的七位分析師的說法,來年將收縮207%。預計市場將實現11%的增長,這是一個令人失望的結果。
有了這些信息,我們發現Cohu的交易市盈率高於市場。看來大多數投資者都希望公司的業務前景出現轉機,但分析師對這種情況會發生的信心不大。如果市盈率降至更符合負增長前景的水平,這些股東很有可能爲未來的失望做好準備。
關鍵要點
通常,我們傾向於將市盈率的使用限制在確定市場對公司整體健康狀況的看法上。
我們對Cohu分析師預測的審查顯示,其收益萎縮的前景對其高市盈率的影響沒有我們預期的那麼大。當我們看到前景不佳,收益倒退時,我們懷疑股價有下跌的風險,從而使高市盈率走低。這使股東的投資面臨重大風險,潛在投資者面臨支付過高溢價的危險。
在你確定自己的觀點之前,我們已經發現了 Cohu 的 2 個警告信號(1 個令人擔憂!)你應該注意的。
你也許能找到比Cohu更好的投資。如果你想選擇可能的候選人,可以免費查看這份有趣的公司名單,這些公司的市盈率很低(但已經證明可以增加收益)。
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。
風險及免責聲明
- 分享到weixin
- 分享到qq
- 分享到facebook
- 分享到twitter
- 分享到微博
- 粘贴板
使用瀏覽器的分享功能,分享給你的好友吧