Earnings Working Against Nankai Plywood Co.,Ltd.’s (TSE:7887) Share Price
Nankai Plywood Co.,Ltd.’s (TSE:7887) price-to-earnings (or “P/E”) ratio of 6.4x might make it look like a strong buy right now compared to the market in Japan, where around half of the companies have P/E ratios above 14x and even P/E’s above 21x are quite common. Although, it’s not wise to just take the P/E at face value as there may be an explanation why it’s so limited.
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With earnings growth that’s exceedingly strong of late, Nankai PlywoodLtd has been doing very well. One possibility is that the P/E is low because investors think this strong earnings growth might actually underperform the…
