Does Pingtan Marine Enterprise Ltd. (NASDAQ:PME) look healthy?


We are going to take a close look at Pingtan Marine Enterprise Ltd. (NASDAQ:PME) today to get a better sense of the company and its current status, as well as the opportunity it may offer for prospective investors. Today’s focus will be a fundamental evaluation of the stock from top to bottom.

As such, let’s start with the top line: Revenue trends.

Last quarter, the company saw its overall sales move to $13.15M in total revenues. That represents an overall change in revenues, on a quarterly year/year basis, of -0.06%. If we translate that into sequential terms, the company saw sales grow by 0.91% from quarter to quarter.

It?s important to closely track the top line data. There’s no better way to measure the end market?s reception of a company?s products. But no one truly wins without bottom line success, which is what we need to look at next.

Pingtan Marine Enterprise Ltd. (NASDAQ:PME) is intriguing when broken down to its core data. The cost of selling goods last quarter was $3.28M, yielding a gross basic income of $9.87M. For shareholders, given the total diluted outstanding shares of 79.06M, this means an overall earnings per share of $0.08. Note, this compares with a consensus analyst forecast of $ in earnings per share for its next fiscal quarterly report.

Given that data, we now turn to a more thorough glance across analyst expectations for the company going forward.

While we don’t suggest taking analyst recommendations as face value plans for action in a portfolio, we do think it is important to note where consensus is on a stock to understand what basic assumptions are perhaps already discounted into market pricing of shares of the stock.

In addition, if we turn to next year, we see estimates of a fiscal year forecast to bring about in total earnings per share. On a median price to earnings ratio basis, that outlook adds up to a valuation of $ times earnings.

At this point, we?ve taken a thorough look at this company from top to bottom, and gotten a sense of what analysts are expecting. But underneath it all, when push comes to shove, companies make it through tough times on balance sheet strength. With that in mind, we should take a look under the hood here.

As the reader is no doubt aware, for any company, balance sheet health sits at the heart of the company’s capacity to stand up to the demands and obligations incurred by normal and contingent operations, which in turn lies at the core of a company’s ability to retain the faith of investors in the marketplace. For Pingtan Marine Enterprise Ltd. (NASDAQ:PME), the company presently holds about $3.73M in cash in the coffers. That cash is balanced against about $38.85M in total current liabilities.

It’s important to consider both a static and dynamic picture, particularly where debt levels are concerned. This means, we need to take into account any trends. In this case, the company’s debt has been growing. The company also has $226.47M in total assets, balanced by $86.76M in total liabilities, which suggests where this story might go under adverse economic or financial conditions.

As far as cash flows, the company saw a free cash flow last quarter of $(35.16M), representing a quarterly net change in cash of $(2.29M). On a net operating level, the company saw about $(7.98M) in cash flow.

Let’s take a look at the technical analysis.

The Barchart Technical Opinion rating is a 56% Sell with a Strengthening short term outlook on maintaining the current direction. Longer term, the trend strength is Maximum. Long term indicators mostly agree with the trend. The market is approaching oversold territory. Be watchful of a trend reversal.

On May 10, 2017, a report asserted that Pingtan concealed its involvement in forced labor, illegal fishing, and human trafficking schemes. When this information was released, the Company’s shares fell in value.

We will update the interesting story of Pingtan Marine Enterprise Ltd. (NASDAQ:PME) as new events transpire.

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