A key reason behind the correction in stock price has been the fundamentals finally beginning to catch up with the stock. Over the last 10 quarters, RVNL has not managed to have a consistent trend in terms of topline growth. In fact, in the last 10 quarters, the company has managed to deliver positive growth in only three of them.
Fundamentals may have caught up with this railway stock, but are valuations reflecting it?
This railway stock’s dream run has stalled, but is it fairly valued yet?
Despite a 50% correction from the peak, shares of RVNL are still trading at a one-year forward price-to-earnings multiple of 44 times, nearly double its five-year average multiple of 23 times.
By Hormaz Fatakia
State-run Rail Vikas Nigam (RVNL) is back in the headlines, though for the first time in six years it's for the wrong reason, at least when it comes to share price returns.
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