Agree on the overvalued part. Although, I would think that most technology companies would trade on a price/sales multiple of at least 3 as they usually operate on high margins.
To illustrate my point. A stock with a 20% margin trading on a p/s multiple of 3 would therefore trade on a p/e of 15 (3/20%). Given these companies tend to have good growth prospects and ability to translate a high portion of their earnings into free cash flow that's a pretty conservative valuation.
Conversely, a P/S multiple of 3 might be high for low margin low growth business. For example a 5% net margin stock trading on a p/s of 3 would equate to a p/e of 60 which unless they have incredible growth prospects if expensive.
ASX is the ultimate example of a high margin business. It trades on a price/sales multiple of 10 and I think it offers pretty good value at present.
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Agree on the overvalued part. Although, I would think that most...
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Last
$134.42 |
Change
1.500(1.13%) |
Mkt cap ! $20.51B |
Open | High | Low | Value | Volume |
$134.01 | $134.50 | $132.97 | $40.30M | 300.5K |
Buyers (Bids)
No. | Vol. | Price($) |
---|---|---|
3 | 2541 | $134.39 |
Sellers (Offers)
Price($) | Vol. | No. |
---|---|---|
$134.42 | 629 | 2 |
View Market Depth
No. | Vol. | Price($) |
---|---|---|
3 | 2541 | 134.390 |
1 | 500 | 134.250 |
1 | 167 | 133.610 |
1 | 1001 | 133.600 |
1 | 3224 | 133.540 |
Price($) | Vol. | No. |
---|---|---|
134.470 | 167 | 1 |
134.500 | 413 | 3 |
134.590 | 40 | 1 |
134.640 | 101 | 1 |
134.750 | 50 | 1 |
Last trade - 16.10pm 26/06/2024 (20 minute delay) ? |
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