Yes, if you’d bought a 1000 of HANS at $4.00 2 years ago, you’d be worth an additional $81000 today !
Actually it wasn’t my intention to present HANS according to the PEG theory, but rather to highlight the fact that its P/E ratio just prior, and just after, the publication of its Financial Results would show very different scenarios based on what HANS showed in its Bottom Line, and hence in its EPS and P/E. Once HANS showed the market what it had earned in the last Quarter, the market responded by buying its stock and so raising the price. The market also appeared prepared to trade HANS with P/E’s of between 21 and 28. My last calculation of 8536/339 = 25 is unlikely to occur as we can expect HANS’s price to increase by some amount. If we take the average of your 15% and the Analyst’s rate of 10% we have a future price of 8536 x 1.125 = 9600, giving a forward P/E of 9600/339 = 28. This is at the top end of HAN’s past acceptable price, all things being equal !
I see you prefer to look at a company's Gross Profit. My personal preference is the relationship between Turnover and EBIDTA. I like to see the effect of BOTH Cost of Sales and Running Expenses, but that's JMO.
I would agree with you that we aren’t likely to see the sort of price growth rates, in percentage terms, that we’ve seen in the past. But, as always, the proof of the pudding is in the numbers, which is why I prefer to wait and see what a company’s published financial statements tell me before I come to any conclusions. Thanx for your in depth replies. |
