Stock Analysis

A Piece Of The Puzzle Missing From Pangaea Connectivity Technology Limited's (HKG:1473) 95% Share Price Climb

SEHK:1473
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The Pangaea Connectivity Technology Limited (HKG:1473) share price has done very well over the last month, posting an excellent gain of 95%. The last 30 days bring the annual gain to a very sharp 67%.

In spite of the firm bounce in price, there still wouldn't be many who think Pangaea Connectivity Technology's price-to-sales (or "P/S") ratio of 0.1x is worth a mention when the median P/S in Hong Kong's Electronic industry is similar at about 0.4x. However, investors might be overlooking a clear opportunity or potential setback if there is no rational basis for the P/S.

View our latest analysis for Pangaea Connectivity Technology

ps-multiple-vs-industry
SEHK:1473 Price to Sales Ratio vs Industry August 8th 2025
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How Pangaea Connectivity Technology Has Been Performing

Recent times have been quite advantageous for Pangaea Connectivity Technology as its revenue has been rising very briskly. Perhaps the market is expecting future revenue performance to taper off, which has kept the P/S from rising. Those who are bullish on Pangaea Connectivity Technology will be hoping that this isn't the case, so that they can pick up the stock at a lower valuation.

Want the full picture on earnings, revenue and cash flow for the company? Then our free report on Pangaea Connectivity Technology will help you shine a light on its historical performance.

What Are Revenue Growth Metrics Telling Us About The P/S?

Pangaea Connectivity Technology's P/S ratio would be typical for a company that's only expected to deliver moderate growth, and importantly, perform in line with the industry.

Retrospectively, the last year delivered an exceptional 54% gain to the company's top line. The strong recent performance means it was also able to grow revenue by 74% in total over the last three years. So we can start by confirming that the company has done a great job of growing revenue over that time.

Comparing that to the industry, which is only predicted to deliver 17% growth in the next 12 months, the company's momentum is stronger based on recent medium-term annualised revenue results.

With this information, we find it interesting that Pangaea Connectivity Technology is trading at a fairly similar P/S compared to the industry. Apparently some shareholders believe the recent performance is at its limits and have been accepting lower selling prices.

The Final Word

Pangaea Connectivity Technology's stock has a lot of momentum behind it lately, which has brought its P/S level with the rest of the industry. It's argued the price-to-sales ratio is an inferior measure of value within certain industries, but it can be a powerful business sentiment indicator.

To our surprise, Pangaea Connectivity Technology revealed its three-year revenue trends aren't contributing to its P/S as much as we would have predicted, given they look better than current industry expectations. When we see strong revenue with faster-than-industry growth, we can only assume potential risks are what might be placing pressure on the P/S ratio. While recent revenue trends over the past medium-term suggest that the risk of a price decline is low, investors appear to see the likelihood of revenue fluctuations in the future.

You need to take note of risks, for example - Pangaea Connectivity Technology has 4 warning signs (and 2 which shouldn't be ignored) we think you should know about.

It's important to make sure you look for a great company, not just the first idea you come across. So if growing profitability aligns with your idea of a great company, take a peek at this free list of interesting companies with strong recent earnings growth (and a low P/E).

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

About SEHK:1473

Pangaea Connectivity Technology

An investment holding company, engages in the import and export of electronic components in Hong Kong, Mainland China, and internationally.

Slight with mediocre balance sheet.

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