Despite an already strong run, Shanghai Hajime Advanced Material Technology Co., Ltd. (SZSE:301000) shares have been powering on, with a gain of 32% in the last thirty days. The last month tops off a massive increase of 278% in the last year.
Since its price has surged higher, Shanghai Hajime Advanced Material Technology may be sending very bearish signals at the moment with a price-to-earnings (or “P/E”) ratio of 67.8x, since almost half of all companies in China have P/E ratios under 36x and even P/E’s lower than 20x are not unusual. Nonetheless, we’d need to dig a little deeper to determine if there is a rational basis for the highly elevated P/E.
With its earnings growth in positive territory compared to the declining earnings of most other companies, Shanghai Hajime Advanced Material Technology has been doing quite well of late. The P/E is probably high because investors think the company will continue to navigate…
