MOA Life Plus Co. Ltd.'s (KOSDAQ:142760) Share Price Boosted 26% But Its Business Prospects Need A Lift Too

Simply Wall St · 06/10 22:40

MOA Life Plus Co. Ltd. (KOSDAQ:142760) shareholders have had their patience rewarded with a 26% share price jump in the last month. Unfortunately, the gains of the last month did little to right the losses of the last year with the stock still down 28% over that time.

Although its price has surged higher, MOA Life Plus' price-to-sales (or "P/S") ratio of 4.4x might still make it look like a strong buy right now compared to the wider Biotechs industry in Korea, where around half of the companies have P/S ratios above 10.9x and even P/S above 43x are quite common. Although, it's not wise to just take the P/S at face value as there may be an explanation why it's so limited.

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See our latest analysis for MOA Life Plus

ps-multiple-vs-industry
KOSDAQ:A142760 Price to Sales Ratio vs Industry June 10th 2025

What Does MOA Life Plus' Recent Performance Look Like?

For example, consider that MOA Life Plus' financial performance has been poor lately as its revenue has been in decline. One possibility is that the P/S is low because investors think the company won't do enough to avoid underperforming the broader industry in the near future. However, if this doesn't eventuate then existing shareholders may be feeling optimistic about the future direction of the share price.

We don't have analyst forecasts, but you can see how recent trends are setting up the company for the future by checking out our free report on MOA Life Plus' earnings, revenue and cash flow.

How Is MOA Life Plus' Revenue Growth Trending?

In order to justify its P/S ratio, MOA Life Plus would need to produce anemic growth that's substantially trailing the industry.

In reviewing the last year of financials, we were disheartened to see the company's revenues fell to the tune of 26%. The last three years don't look nice either as the company has shrunk revenue by 86% in aggregate. Therefore, it's fair to say the revenue growth recently has been undesirable for the company.

Comparing that to the industry, which is predicted to deliver 60% growth in the next 12 months, the company's downward momentum based on recent medium-term revenue results is a sobering picture.

In light of this, it's understandable that MOA Life Plus' P/S would sit below the majority of other companies. Nonetheless, there's no guarantee the P/S has reached a floor yet with revenue going in reverse. There's potential for the P/S to fall to even lower levels if the company doesn't improve its top-line growth.

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The Final Word

Even after such a strong price move, MOA Life Plus' P/S still trails the rest of the industry. While the price-to-sales ratio shouldn't be the defining factor in whether you buy a stock or not, it's quite a capable barometer of revenue expectations.

As we suspected, our examination of MOA Life Plus revealed its shrinking revenue over the medium-term is contributing to its low P/S, given the industry is set to grow. At this stage investors feel the potential for an improvement in revenue isn't great enough to justify a higher P/S ratio. Unless the recent medium-term conditions improve, they will continue to form a barrier for the share price around these levels.

There are also other vital risk factors to consider before investing and we've discovered 1 warning sign for MOA Life Plus that you should be aware of.

If you're unsure about the strength of MOA Life Plus' business, why not explore our interactive list of stocks with solid business fundamentals for some other companies you may have missed.