Insufficient Growth At Comal S.p.A. (BIT:CML) Hampers Share Price
Comal S.p.A.’s (BIT:CML) price-to-earnings (or “P/E”) ratio of 8.1x might make it look like a buy right now compared to the market in Italy, where around half of the companies have P/E ratios above 14x and even P/E’s above 24x are quite common. Nonetheless, we’d need to dig a little deeper to determine if there is a rational basis for the reduced P/E.
Comal certainly has been doing a good job lately as it’s been growing earnings more than most other companies. One possibility is that the P/E is low because investors think this strong earnings performance might be less impressive moving forward. If not, then existing shareholders have reason to be quite optimistic about the future direction of the share price.
