Woosu AMS Co.,Ltd.'s (KOSDAQ:066590) 25% Share Price Surge Not Quite Adding Up

Simply Wall St · 3d ago

Woosu AMS Co.,Ltd. (KOSDAQ:066590) shares have continued their recent momentum with a 25% gain in the last month alone. Looking further back, the 21% rise over the last twelve months isn't too bad notwithstanding the strength over the last 30 days.

Following the firm bounce in price, given close to half the companies in Korea have price-to-earnings ratios (or "P/E's") below 13x, you may consider Woosu AMSLtd as a stock to avoid entirely with its 41.4x P/E ratio. Although, it's not wise to just take the P/E at face value as there may be an explanation why it's so lofty.

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For example, consider that Woosu AMSLtd's financial performance has been poor lately as its earnings have been in decline. It might be that many expect the company to still outplay most other companies over the coming period, which has kept the P/E from collapsing. If not, then existing shareholders may be quite nervous about the viability of the share price.

See our latest analysis for Woosu AMSLtd

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KOSDAQ:A066590 Price to Earnings Ratio vs Industry July 3rd 2025
Although there are no analyst estimates available for Woosu AMSLtd, take a look at this free data-rich visualisation to see how the company stacks up on earnings, revenue and cash flow.

How Is Woosu AMSLtd's Growth Trending?

In order to justify its P/E ratio, Woosu AMSLtd would need to produce outstanding growth well in excess of the market.

Retrospectively, the last year delivered a frustrating 54% decrease to the company's bottom line. This has erased any of its gains during the last three years, with practically no change in EPS being achieved in total. So it appears to us that the company has had a mixed result in terms of growing earnings over that time.

This is in contrast to the rest of the market, which is expected to grow by 29% over the next year, materially higher than the company's recent medium-term annualised growth rates.

In light of this, it's alarming that Woosu AMSLtd's P/E sits above the majority of other companies. Apparently many investors in the company are way more bullish than recent times would indicate and aren't willing to let go of their stock at any price. Only the boldest would assume these prices are sustainable as a continuation of recent earnings trends is likely to weigh heavily on the share price eventually.

What We Can Learn From Woosu AMSLtd's P/E?

Shares in Woosu AMSLtd have built up some good momentum lately, which has really inflated its P/E. We'd say the price-to-earnings ratio's power isn't primarily as a valuation instrument but rather to gauge current investor sentiment and future expectations.

We've established that Woosu AMSLtd currently trades on a much higher than expected P/E since its recent three-year growth is lower than the wider market forecast. When we see weak earnings with slower than market growth, we suspect the share price is at risk of declining, sending the high P/E lower. Unless the recent medium-term conditions improve markedly, it's very challenging to accept these prices as being reasonable.

It is also worth noting that we have found 3 warning signs for Woosu AMSLtd (1 is potentially serious!) that you need to take into consideration.

If these risks are making you reconsider your opinion on Woosu AMSLtd, explore our interactive list of high quality stocks to get an idea of what else is out there.