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Is China Unicom (Hong Kong) Limited (CHU) Stock Over or Undervalued?

Monday, October 12, 2020 12:05 PM | InvestorsObserver Analysts

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Is China Unicom (Hong Kong) Limited (CHU) Stock Over or Undervalued?

InvestorsObserver gives China Unicom (Hong Kong) Limited (CHU) a strong valuation score of 98 from its analysis. The proprietary scoring system considers the underlying health of a company by analyzing its stock price, earnings, and growth rate. CHU currently holds a better value than 98% of stocks based on these metrics. Long term investors focused on buying-and-holding should find the valuation ranking system most relevant when making investment decisions.

Valuation Rank - 98
CHU gets a 98 Valuation Rank today. Find out what this means to you and get the rest of the rankings on CHU!

Metrics Analysis

CHU has a trailing twelve month Price to Earnings (PE) ratio of 11.8. The historical average of roughly 15 shows a average value for CHU stock as investors are paying fair share prices relative to the company's earnings. CHU's average trailing PE ratio shows that the firm has been trading around its fair market value recently. Its trailing 12-month earnings per share (EPS) of 0.50 justifies the stock's current price. However, trailing PE ratios do not factor in the company's projected growth rate, resulting in many newer firms having high PE ratios due to high growth potential enticing investors despite inadequate earnings.

CHU's 12-month-forward PE to Growth (PEG) ratio of 0.98 is considered a roughly average value as the market is valuing CHU right in line with its projected earnings growth. CHU's PEG comes from its forward price to earnings ratio being divided by its growth rate. A PEG ratio of 1 represents a perfect correlation between earnings growth and share price. Due to their incorporation of more fundamentals of a company's overall health and focusing on the future rather than the past, PEG ratios are one of the most used valuation metrics by analysts today.

Summary

CHU's valuation metrics are adequate at its current price due to a fairly valued PEG ratio despite strong growth. CHU's PE and PEG are around the market average resulting in a average valuation score.

Click Here to get the full Stock Score Report on China Unicom (Hong Kong) Limited (CHU) Stock.

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