Naturally, looking at only one ratio (or even completing a full ratio analysis) does not suffice to determine with certainty if an asset is overpriced or under-priced, but this is still a very interesting exercise.
Stocks from the Telecommunications sector seem well overpriced at least in terms of price to earnings.
HNX stocks seem to be under-priced compared to HOSE stocks this time not only in terms of price to earnings but also in terms of price to book ratio. This is not a new phenomenon since we have spotted this trend for a couple of years now. One of the main explanations for this discrepancy between values of stocks belonging to the two major stock exchanges is that stocks listed on the Hanoi stock Exchange tend to be those of smaller companies while larger and more international companies tend to focus on HOSE. Foreign investors, especially funds, are currently much more attracted by stocks on the HOSE market than on the HNX one. They are looking for companies with large market cap but this strategy comes at a price.
Another interesting fact is that while one would expect the UPCoM market - the Unlisted Public Company Market on the HNX is effectively a mezzanine exchange set up to encourage unlisted firms to participate in the securities market, with a view that those on UPCoM may later transfer onto the main market - to be undervalued in terms of the main ratios compared to HOSE and HNX but this is not the case.
Interestingly enough, Bank stocks also seem to provide good value these days.
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