Why We’re Not Concerned Yet About Jumia Technologies AG’s (NYSE:JMIA) 26% Share Price Plunge
Jumia Technologies AG (NYSE:JMIA) shareholders won’t be pleased to see that the share price has had a very rough month, dropping 26% and undoing the prior period’s positive performance. Of course, over the longer-term many would still wish they owned shares as the stock’s price has soared 159% in the last twelve months.
Although its price has dipped substantially, given around half the companies in the United States’ Multiline Retail industry have price-to-sales ratios (or “P/S”) below 1.3x, you may still consider Jumia Technologies as a stock to avoid entirely with its 7.4x P/S ratio. Nonetheless, we’d need to dig a little deeper to determine if there is a rational basis for the highly elevated P/S.
