WEBULL

United U-LI Corporation Berhad (KLSE:ULICORP) Might Not Be As Mispriced As It Looks

Simply Wall St · 08/29 22:08

When close to half the companies in Malaysia have price-to-earnings ratios (or "P/E's") above 15x, you may consider United U-LI Corporation Berhad (KLSE:ULICORP) as an attractive investment with its 9.2x 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 limited.

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With earnings growth that's inferior to most other companies of late, United U-LI Corporation Berhad has been relatively sluggish. The P/E is probably low because investors think this lacklustre earnings performance isn't going to get any better. If you still like the company, you'd be hoping earnings don't get any worse and that you could pick up some stock while it's out of favour.

See our latest analysis for United U-LI Corporation Berhad

pe-multiple-vs-industry
KLSE:ULICORP Price to Earnings Ratio vs Industry August 29th 2025
Keen to find out how analysts think United U-LI Corporation Berhad's future stacks up against the industry? In that case, our free report is a great place to start.

Is There Any Growth For United U-LI Corporation Berhad?

The only time you'd be truly comfortable seeing a P/E as low as United U-LI Corporation Berhad's is when the company's growth is on track to lag the market.

Taking a look back first, we see that there was hardly any earnings per share growth to speak of for the company over the past year. This isn't what shareholders were looking for as it means they've been left with a 15% decline in EPS over the last three years in total. Therefore, it's fair to say the earnings growth recently has been undesirable for the company.

Looking ahead now, EPS is anticipated to climb by 20% during the coming year according to the only analyst following the company. Meanwhile, the rest of the market is forecast to only expand by 16%, which is noticeably less attractive.

With this information, we find it odd that United U-LI Corporation Berhad is trading at a P/E lower than the market. Apparently some shareholders are doubtful of the forecasts and have been accepting significantly lower selling prices.

The Final Word

Using the price-to-earnings ratio alone to determine if you should sell your stock isn't sensible, however it can be a practical guide to the company's future prospects.

We've established that United U-LI Corporation Berhad currently trades on a much lower than expected P/E since its forecast growth is higher than the wider market. There could be some major unobserved threats to earnings preventing the P/E ratio from matching the positive outlook. It appears many are indeed anticipating earnings instability, because these conditions should normally provide a boost to the share price.

You always need to take note of risks, for example - United U-LI Corporation Berhad has 2 warning signs we think you should be aware of.

Of course, you might also be able to find a better stock than United U-LI Corporation Berhad. So you may wish to see this free collection of other companies that have reasonable P/E ratios and have grown earnings strongly.