Risks Still Elevated At These Prices As Jumia Technologies AG (NYSE:JMIA) Shares Dive 26%
Risks Still Elevated At These Prices As Jumia Technologies AG (NYSE:JMIA) Shares Dive 26%
Jumia Technologies AG (NYSE:JMIA) shares have retraced a considerable 26% in the last month, reversing a fair amount of their solid recent performance. Looking at the bigger picture, even after this poor month the stock is up 70% in the last year.
Although its price has dipped substantially, given close to half the companies operating in the United States' Multiline Retail industry have price-to-sales ratios (or "P/S") below 0.9x, you may still consider Jumia Technologies as a stock to potentially avoid with its 2.8x P/S ratio. However, the P/S might be high for a reason and it requires further investigation to determine if it's justified.
How Jumia Technologies Has Been Performing
Jumia Technologies could be doing better as its revenue has been going backwards lately while most other companies have been seeing positive revenue growth. Perhaps the market is expecting the poor revenue to reverse, justifying it's current high P/S.. However, if this isn't the case, investors might get caught out paying too much for the stock.
Keen to find out how analysts think Jumia Technologies' future stacks up against the industry? In that case, our free report is a great place to start.What Are Revenue Growth Metrics Telling Us About The High P/S?
There's an inherent assumption that a company should outperform the industry for P/S ratios like Jumia Technologies' to be considered reasonable.
In reviewing the last year of financials, we were disheartened to see the company's revenues fell to the tune of 8.3%. This has soured the latest three-year period, which nevertheless managed to deliver a decent 17% overall rise in revenue. Although it's been a bumpy ride, it's still fair to say the revenue growth recently has been mostly respectable for the company.
Looking ahead now, revenue is anticipated to climb by 4.4% per annum during the coming three years according to the dual analysts following the company. With the industry predicted to deliver 13% growth per annum, the company is positioned for a weaker revenue result.
With this in consideration, we believe it doesn't make sense that Jumia Technologies' P/S is outpacing its industry peers. Apparently many investors in the company are way more bullish than analysts indicate and aren't willing to let go of their stock at any price. There's a good chance these shareholders are setting themselves up for future disappointment if the P/S falls to levels more in line with the growth outlook.
What We Can Learn From Jumia Technologies' P/S?
Despite the recent share price weakness, Jumia Technologies' P/S remains higher than most other companies in the industry. We'd say the price-to-sales ratio's power isn't primarily as a valuation instrument but rather to gauge current investor sentiment and future expectations.
Despite analysts forecasting some poorer-than-industry revenue growth figures for Jumia Technologies, this doesn't appear to be impacting the P/S in the slightest. The weakness in the company's revenue estimate doesn't bode well for the elevated P/S, which could take a fall if the revenue sentiment doesn't improve. Unless these conditions improve markedly, it's very challenging to accept these prices as being reasonable.
It's always necessary to consider the ever-present spectre of investment risk. We've identified 2 warning signs with Jumia Technologies (at least 1 which is a bit unpleasant), and understanding these 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.
Jumia Technologies AG(紐約證券交易所代碼:JMIA)的股價在上個月大幅回落了26%,扭轉了近期的穩健表現。從大局來看,即使在這個糟糕的月份之後,該股去年仍上漲了70%。
儘管其價格已大幅下跌,但鑑於在美國多線零售行業運營的公司中有近一半的市銷比(或 “市銷率”)低於0.9倍,您仍然可以將Jumia Technologies視爲可能避開的股票,其市銷率爲2.8倍。但是,市銷率之高可能是有原因的,需要進一步調查以確定其是否合理。
Jumia Technologies的表現如何
Jumia Technologies可能會做得更好,因爲其收入最近一直在倒退,而大多數其他公司的收入卻出現了正增長。也許市場預計收入不佳的情況將逆轉,這證明了目前的高市銷率是合理的。但是,如果不是這樣,投資者可能會陷入爲股票支付過多費用的困境。
想了解分析師如何看待Jumia Technologies的未來與該行業的對立嗎?在這種情況下,我們的免費報告是一個很好的起點。收入增長指標告訴我們高市銷率有哪些?
人們固有的假設是,如果像Jumia Technologies這樣的市銷率被認爲是合理的,公司的表現應該優於該行業。
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8.3%。這使最近的三年期惡化,儘管如此,總收入仍實現了17%的可觀增長。儘管這是一個坎坷的旅程,但可以公平地說,該公司最近的收入增長基本上是可觀的。
根據關注該公司的雙重分析師的說法,展望未來,預計未來三年收入將每年增長4.4%。預計該行業每年將實現13%的增長,因此該公司的收入業績將疲軟。
考慮到這一點,我們認爲Jumia Technologies的市銷率超過業內同行是沒有意義的。顯然,該公司的許多投資者比分析師所表示的要看漲得多,他們不願意以任何價格拋售股票。如果市銷售率降至更符合增長前景的水平,這些股東很有可能爲未來的失望做好準備。
我們可以從Jumia Technologies的市銷率中學到什麼?
儘管最近股價疲軟,但Jumia Technologies的市銷率仍然高於業內大多數其他公司。我們可以說,市銷比率的力量主要不是作爲一種估值工具,而是用來衡量當前的投資者情緒和未來預期。
儘管分析師預測Jumia Technologies的收入增長數據將低於行業,但這似乎絲毫沒有影響市銷率。公司收入估計的疲軟對於市銷率的上升來說並不是一個好兆頭,如果收入情緒沒有改善,市銷率可能會下降。除非這些條件顯著改善,否則要接受這些合理的價格是非常困難的。
始終有必要考慮永遠存在的投資風險幽靈。我們已經在Jumia Technologies發現了兩個警告信號(至少有一個有點不愉快),了解這些信號應該是你投資過程的一部分。
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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