Shanghai Ganglian E-Commerce Holdings Co., Ltd. (SZSE:300226) 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. The recent drop completes a disastrous twelve months for shareholders, who are sitting on a 55% loss during that time.
Since its price has dipped substantially, Shanghai Ganglian E-Commerce Holdings’ price-to-earnings (or “P/E”) ratio of 25.1x might make it look like a buy right now compared to the market in China, where around half of the companies have P/E ratios above 30x and even P/E’s above 53x are quite common. Nonetheless, we’d need to dig a little deeper to determine if there is a rational basis for the reduced P/E.
Shanghai Ganglian E-Commerce Holdings certainly has been doing a good job lately as it’s been growing earnings more than most other companies. It might be that many expect the strong…
