WEBULL

Inno Instrument Inc.'s (KOSDAQ:215790) Popularity With Investors Under Threat As Stock Sinks 26%

Simply Wall St · 2d ago

Inno Instrument Inc. (KOSDAQ:215790) shares have retraced a considerable 26% in the last month, reversing a fair amount of their solid recent performance. Looking back over the past twelve months the stock has been a solid performer regardless, with a gain of 23%.

Even after such a large drop in price, there still wouldn't be many who think Inno Instrument's price-to-sales (or "P/S") ratio of 0.5x is worth a mention when the median P/S in Korea's Communications industry is similar at about 1x. However, investors might be overlooking a clear opportunity or potential setback if there is no rational basis for the P/S.

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Check out our latest analysis for Inno Instrument

ps-multiple-vs-industry
KOSDAQ:A215790 Price to Sales Ratio vs Industry December 11th 2025

How Has Inno Instrument Performed Recently?

Revenue has risen at a steady rate over the last year for Inno Instrument, which is generally not a bad outcome. Perhaps the expectation moving forward is that the revenue growth will track in line with the wider industry for the near term, which has kept the P/S subdued. Those who are bullish on Inno Instrument will be hoping that this isn't the case, so that they can pick up the stock at a lower valuation.

Although there are no analyst estimates available for Inno Instrument, take a look at this free data-rich visualisation to see how the company stacks up on earnings, revenue and cash flow.

How Is Inno Instrument's Revenue Growth Trending?

Inno Instrument's P/S ratio would be typical for a company that's only expected to deliver moderate growth, and importantly, perform in line with the industry.

If we review the last year of revenue growth, the company posted a worthy increase of 3.2%. Ultimately though, it couldn't turn around the poor performance of the prior period, with revenue shrinking 5.5% in total over the last three years. Accordingly, shareholders would have felt downbeat about the medium-term rates of revenue growth.

In contrast to the company, the rest of the industry is expected to grow by 49% over the next year, which really puts the company's recent medium-term revenue decline into perspective.

With this information, we find it concerning that Inno Instrument is trading at a fairly similar P/S compared to the industry. It seems most investors are ignoring the recent poor growth rate and are hoping for a turnaround in the company's business prospects. There's a good chance existing shareholders are setting themselves up for future disappointment if the P/S falls to levels more in line with the recent negative growth rates.

The Key Takeaway

Following Inno Instrument's share price tumble, its P/S is just clinging on to the industry median P/S. Using the price-to-sales 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 find it unexpected that Inno Instrument trades at a P/S ratio that is comparable to the rest of the industry, despite experiencing declining revenues during the medium-term, while the industry as a whole is expected to grow. When we see revenue heading backwards in the context of growing industry forecasts, it'd make sense to expect a possible share price decline on the horizon, sending the moderate P/S lower. Unless the recent medium-term conditions improve markedly, investors will have a hard time accepting the share price as fair value.

Before you settle on your opinion, we've discovered 3 warning signs for Inno Instrument (2 are potentially serious!) that you should be aware of.

It's important to make sure you look for a great company, not just the first idea you come across. So if growing profitability aligns with your idea of a great company, take a peek at this free list of interesting companies with strong recent earnings growth (and a low P/E).