Earnings Tell The Story For Green Landscaping Group AB (publ) (STO:GREEN) As Its Stock Soars 26%
Despite an already strong run Green Landscaping Group AB (publ) (STO: GREEN) Stocks have turned on in the past thirty days, up 26%. The last 30 days bring the annual profit to a very sharp 70%.
Since the price has risen and almost half of the companies in Sweden have value for money (or “P / E”) below 23x, you can think of Green Landscaping Group as a stock you can buy at 57.7 -fold P should completely avoid / E ratio. However, it is not advisable to just take the P / E at face value as there may be an explanation for why it is so high.
The Green Landscaping Group has certainly done a good job lately as it grows its profits faster than most other companies. The P / E ratio is likely to be high as investors expect this strong earnings performance to continue. You’d really hope so, or you’re paying a pretty high price for no particular reason.
Check out our latest analysis for the Green Landscaping Group
OM: GREEN price based on previous earnings February 28, 2021 Want to find out how analysts see the future of the Green Landscaping Group versus the industry? In this case it is ours free Report is a good place to start.
Does the growth match the high P / E ratio?
To justify the P / E ratio, the Green Landscaping Group would need to achieve outstanding growth that is well above the market.
If we look at the last year of earnings growth, the company saw a huge 352% gain. Due to the strong recent performance, the EPS has increased by a total of 41% in the last three years. So, first of all, we can confirm that the company has done an excellent job during this time to grow profits.
Estimates by the one analyst who covers the company are that earnings should increase 47% annually over the next three years. The rest of the market is forecast to grow only 18% per year, which is noticeably less attractive.
With this in mind, it is understandable that the P / E ratio of the Green Landscaping Group is above the majority of the other companies. It seems that most investors are expecting this strong future growth and are willing to pay more for the stock.
The conclusion to the P / E of the Green Landscaping Group
The sharp rise in the share price also drove up the P / E ratio of the Green Landscaping Group. We usually caution against reading too much about value for money when deciding to invest, although this can tell a lot about what other market participants think of the company.
As we suspected, our review of the Green Landscaping Group’s analyst guidance found that the superior earnings outlook contributed to its high P / E ratio. Right now, shareholders are happy with the P / E ratio as they are fairly confident that future earnings are not at risk. Unless these terms change, they will continue to provide strong support to the stock price.
And what about other risks? Every company has them and we discovered them 3 warning signs for the Green Landscaping Group You should know it.
Sure You could find a fantastic investment by looking at a few good candidates. So take a look at it free List of companies with strong growth records trading at P / E ratios below 20x.
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