Why Investors Shouldn't Be Surprised By Zhejiang Yiming Food Co., Ltd.'s (SHSE:605179) 29% Share Price Surge
Why Investors Shouldn't Be Surprised By Zhejiang Yiming Food Co., Ltd.'s (SHSE:605179) 29% Share Price Surge
Zhejiang Yiming Food Co., Ltd. (SHSE:605179) shareholders are no doubt pleased to see that the share price has bounced 29% in the last month, although it is still struggling to make up recently lost ground. Looking further back, the 19% rise over the last twelve months isn't too bad notwithstanding the strength over the last 30 days.
In spite of the firm bounce in price, you could still be forgiven for feeling indifferent about Zhejiang Yiming Food's P/S ratio of 2.1x, since the median price-to-sales (or "P/S") ratio for the Food industry in China is also close to 1.8x. 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 Zhejiang Yiming Food Has Been Performing
With revenue growth that's inferior to most other companies of late, Zhejiang Yiming Food has been relatively sluggish. One possibility is that the P/S ratio is moderate because investors think this lacklustre revenue performance will turn around. However, if this isn't the case, investors might get caught out paying too much for the stock.
If you'd like to see what analysts are forecasting going forward, you should check out our free report on Zhejiang Yiming Food.Do Revenue Forecasts Match The P/S Ratio?
There's an inherent assumption that a company should be matching the industry for P/S ratios like Zhejiang Yiming Food's to be considered reasonable.
If we review the last year of revenue growth, the company posted a worthy increase of 5.9%. This was backed up an excellent period prior to see revenue up by 32% in total over the last three years. So we can start by confirming that the company has done a great job of growing revenues over that time.
Looking ahead now, revenue is anticipated to climb by 14% during the coming year according to the sole analyst following the company. That's shaping up to be similar to the 16% growth forecast for the broader industry.
In light of this, it's understandable that Zhejiang Yiming Food's P/S sits in line with the majority of other companies. Apparently shareholders are comfortable to simply hold on while the company is keeping a low profile.
What Does Zhejiang Yiming Food's P/S Mean For Investors?
Its shares have lifted substantially and now Zhejiang Yiming Food's P/S is back within range of the industry median. 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.
Our look at Zhejiang Yiming Food's revenue growth estimates show that its P/S is about what we expect, as both metrics follow closely with the industry averages. Right now shareholders are comfortable with the P/S as they are quite confident future revenue won't throw up any surprises. Unless these conditions change, they will continue to support the share price at these levels.
A lot of potential risks can sit within a company's balance sheet. Take a look at our free balance sheet analysis for Zhejiang Yiming Food with six simple checks on some of these key factors.
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.
浙江一鳴食品有限公司(SHSE: 605179)股東無疑高興地看到,股價在上個月反彈了29%,儘管它仍在努力彌補最近的跌勢。再往前看,儘管在過去的30天中表現強勁,但過去十二個月的19%的增長並不算太糟糕。
儘管價格穩步反彈,但您對浙江一鳴食品2.1倍的市銷率漠不關心仍然是可以原諒的,因爲中國食品行業的中位市銷率(或 “市銷率”)也接近1.8倍。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。
浙江一鳴食品的表現如何
由於最近的收入增長不如其他大多數公司,浙江一鳴食品一直相對疲軟。一種可能性是市銷率適中,因爲投資者認爲這種乏善可陳的收入表現將扭轉。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。
如果你想了解分析師對未來的預測,你應該查看我們關於浙江一鳴食品的免費報告。收入預測與市銷率相匹配嗎?
人們固有的假設是,公司應該與行業相匹配,使像浙江一鳴食品這樣的市銷率被認爲是合理的。
如果我們回顧一下去年的收入增長,該公司公佈了5.9%的可觀增長。在過去三年中,總收入增長了32%,此前這是一個很好的時期。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做得很好。
根據關注該公司的唯一分析師的說法,展望未來,來年收入預計將增長14%。這將與整個行業16%的增長預測相似。
有鑑於此,浙江一鳴食品的市銷率與其他多數公司持平,這是可以理解的。顯然,在公司保持低調的同時,股東們很樂意堅持下去。
浙江一鳴食品的市銷率對投資者意味着什麼?
其股價已大幅上漲,現在浙江一鳴食品的市銷率已恢復在行業中位數範圍內。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。
我們對浙江一鳴食品收入增長估計的研究表明,其市銷率與我們的預期差不多,因爲這兩個指標都與行業平均水平密切相關。目前,股東們對市銷率感到滿意,因爲他們非常有信心未來的收入不會帶來任何意外。除非這些條件發生變化,否則它們將繼續在這些水平上支撐股價。
公司的資產負債表中可能存在許多潛在風險。看看我們對浙江一鳴食品的免費資產負債表分析,對其中一些關鍵因素進行了六項簡單檢查。
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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