Investors Appear Satisfied With Global SM Tech Limited's (KOSDAQ:900070) Prospects As Shares Rocket 30%

Simply Wall St · 4d ago

Despite an already strong run, Global SM Tech Limited (KOSDAQ:900070) shares have been powering on, with a gain of 30% in the last thirty days. Looking further back, the 16% rise over the last twelve months isn't too bad notwithstanding the strength over the last 30 days.

Following the firm bounce in price, Global SM Tech may be sending bearish signals at the moment with its price-to-earnings (or "P/E") ratio of 15.8x, since almost half of all companies in Korea have P/E ratios under 13x and even P/E's lower than 7x are not unusual. Nonetheless, we'd need to dig a little deeper to determine if there is a rational basis for the elevated P/E.

Global SM Tech has been doing a good job lately as it's been growing earnings at a solid pace. One possibility is that the P/E is high because investors think this respectable earnings growth will be enough to outperform the broader market in the near future. You'd really hope so, otherwise you're paying a pretty hefty price for no particular reason.

Check out our latest analysis for Global SM Tech

pe-multiple-vs-industry
KOSDAQ:A900070 Price to Earnings Ratio vs Industry July 4th 2025
Want the full picture on earnings, revenue and cash flow for the company? Then our free report on Global SM Tech will help you shine a light on its historical performance.

How Is Global SM Tech's Growth Trending?

There's an inherent assumption that a company should outperform the market for P/E ratios like Global SM Tech's to be considered reasonable.

Retrospectively, the last year delivered a decent 11% gain to the company's bottom line. The latest three year period has also seen an excellent 6,706% overall rise in EPS, aided somewhat by its short-term performance. So we can start by confirming that the company has done a great job of growing earnings over that time.

Weighing that recent medium-term earnings trajectory against the broader market's one-year forecast for expansion of 29% shows it's noticeably more attractive on an annualised basis.

In light of this, it's understandable that Global SM Tech's P/E sits above the majority of other companies. It seems most investors are expecting this strong growth to continue and are willing to pay more for the stock.

The Final Word

Global SM Tech shares have received a push in the right direction, but its P/E is elevated too. Generally, our preference is to limit the use of the price-to-earnings ratio to establishing what the market thinks about the overall health of a company.

As we suspected, our examination of Global SM Tech revealed its three-year earnings trends are contributing to its high P/E, given they look better than current market expectations. Right now shareholders are comfortable with the P/E as they are quite confident earnings aren't under threat. If recent medium-term earnings trends continue, it's hard to see the share price falling strongly in the near future under these circumstances.

You should always think about risks. Case in point, we've spotted 1 warning sign for Global SM Tech you should be aware of.

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