eGuarantee, Inc.’s (TSE:8771) Share Price Matching Investor Opinion
When close to half the companies in Japan have price-to-earnings ratios (or “P/E’s”) below 13x, you may consider eGuarantee, Inc. (TSE:8771) as a stock to avoid entirely with its 21.5x P/E ratio. Although, it’s not wise to just take the P/E at face value as there may be an explanation why it’s so lofty.
eGuarantee’s earnings growth of late has been pretty similar to most other companies. It might be that many expect the mediocre earnings performance to strengthen positively, which has kept the P/E from falling. If not, then existing shareholders may be a little nervous about the viability of the share price.
