Shanghai Hanbell Precise Machinery Co., Ltd. (SZSE:002158) shareholders would be excited to see that the share price has had a great month, posting a 25% gain and recovering from prior weakness. Taking a wider view, although not as strong as the last month, the full year gain of 13% is also fairly reasonable.
Even after such a large jump in price, Shanghai Hanbell Precise Machinery’s price-to-earnings (or “P/E”) ratio of 14x might still make it look like a strong buy right now compared to the market in China, where around half of the companies have P/E ratios above 39x and even P/E’s above 77x 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.
Recent times have been pleasing for Shanghai Hanbell Precise Machinery as its earnings have risen in spite of the market’s earnings going into reverse. It might be that many expect the strong earnings…
