Carborundum Universal Limited’s (NSE:CARBORUNIV) Price Is Out Of Tune With Earnings
When close to half the companies in India have price-to-earnings ratios (or “P/E’s”) below 32x, you may consider Carborundum Universal Limited (NSE:CARBORUNIV) as a stock to avoid entirely with its 54.8x P/E ratio. However, the P/E might be quite high for a reason and it requires further investigation to determine if it’s justified.
Carborundum Universal could be doing better as it’s been growing earnings less than most other companies lately. One possibility is that the P/E is high because investors think this lacklustre earnings performance will improve markedly. If not, then existing shareholders may be very nervous about the viability of the share price.
Check out our latest analysis for Carborundum Universal
