Improved Revenues Required Before LexinFintech Holdings Ltd. (NASDAQ:LX) Shares Find Their Feet
Improved Revenues Required Before LexinFintech Holdings Ltd. (NASDAQ:LX) Shares Find Their Feet
LexinFintech Holdings Ltd.'s (NASDAQ:LX) price-to-sales (or "P/S") ratio of 0.2x may look like a pretty appealing investment opportunity when you consider close to half the companies in the Consumer Finance industry in the United States have P/S ratios greater than 1.3x. 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 LexinFintech Holdings' Recent Performance Look Like?
LexinFintech Holdings 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 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 out of favour.
If you'd like to see what analysts are forecasting going forward, you should check out our free report on LexinFintech Holdings.Do Revenue Forecasts Match The Low P/S Ratio?
There's an inherent assumption that a company should underperform the industry for P/S ratios like LexinFintech Holdings' to be considered reasonable.
Taking a look back first, we see that the company grew revenue by an impressive 32% last year. The latest three year period has also seen a 12% overall rise in revenue, aided extensively by its short-term performance. So we can start by confirming that the company has actually done a good job of growing revenue over that time.
Turning to the outlook, the next three years should generate growth of 6.7% each year as estimated by the five analysts watching the company. Meanwhile, the rest of the industry is forecast to expand by 15% per annum, which is noticeably more attractive.
With this in consideration, its clear as to why LexinFintech Holdings' P/S is falling short industry peers. It seems most investors are expecting to see limited future growth and are only willing to pay a reduced amount for the stock.
The Final Word
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.
As expected, our analysis of LexinFintech Holdings' analyst forecasts confirms that the company's underwhelming revenue outlook is a major contributor to its low P/S. Shareholders' pessimism on the revenue prospects for the company seems to be the main contributor to the depressed P/S. The company will need a change of fortune to justify the P/S rising higher in the future.
And what about other risks? Every company has them, and we've spotted 1 warning sign for LexinFintech Holdings you should know about.
Of course, profitable companies with a history of great earnings growth are generally safer bets. So you may wish to see this free collection of other companies that have reasonable P/E ratios and have grown earnings strongly.
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.
樂信金融科技控股有限公司'考慮到美國消費金融行業將近一半的公司的市盈率大於1.3倍,s(納斯達克股票代碼:LX)0.2倍的市銷率(或 “市盈率”)可能看起來是一個非常有吸引力的投資機會。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。
樂信金融科技控股公司最近的表現如何?
LexinFintech Holdings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失寵的時候買入一些股票。
如果你想了解分析師對未來的預測,你應該查看我們關於LexinFintech Holdings的免費報告。收入預測與低市銷率相匹配嗎?
人們固有的假設是,如果像LexinFintech Holdings這樣的市銷率被認爲是合理的,公司的表現應該低於該行業。
首先回顧一下,我們發現該公司去年的收入增長了令人印象深刻的32%。在最近三年期間,收入總體增長了12%,這在很大程度上得益於其短期表現。因此,我們可以首先確認該公司在這段時間內在增加收入方面確實做得很好。
展望來看,根據關注該公司的五位分析師的估計,未來三年每年將實現6.7%的增長。同時,預計該行業的其他部門每年將增長15%,這明顯更具吸引力。
考慮到這一點,LexinFintech Holdings的市銷率爲何低於業內同行,就顯而易見了。看來大多數投資者預計未來增長有限,只願意爲股票支付較少的費用。
最後一句話
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。
正如預期的那樣,我們對LexinFintech Holdings分析師預測的分析證實,該公司令人難以置信的收入前景是其低市銷率的主要原因。股東對公司收入前景的悲觀情緒似乎是造成市盈率低迷的主要原因。公司需要改變命運,以證明未來市盈率上升是合理的。
那其他風險呢?每家公司都有它們,我們已經發現了一個你應該知道的LexinFintech控股的警告信號。
當然,具有良好收益增長曆史的盈利公司通常是更安全的選擇。因此,您可能希望看到這些免費收集的市盈率合理且收益增長強勁的其他公司。
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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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