Singapore Airlines Limited's (SGX:C6L) Price Is Right But Growth Is Lacking

With a price-to-earnings (or "P/E") ratio of 8.9x Singapore Airlines Limited (SGX:C6L) may be sending bullish signals at the moment, given that almost half of all companies in Singapore have P/E ratios greater than 15x and even P/E's higher than 26x are not unusual. Nonetheless, we'd need to dig a little deeper to determine if there is a rational basis for the reduced P/E. Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit. Recent times have been advantageous for Singapore Airlines as its earnings have been rising faster than most other companies. One possibility is that the P/E is low because investors think this strong earnings performance might be less impressive moving forward. If you like the company, you'd be hoping this isn't the case so that you could potentially pick up some stock while it's out of favour. See our latest analysis for Singapore Airlines SGX:C6L Price to Earnings Ratio vs Industry December 30th 2025 If you'd like to see what analysts are forecasting going forward, you should check out our free report on Singapore Airlines. How Is Singapore Airlines' Growth Trending? Singapore Airlines' P/E ratio would be typical for a company that's only expected to deliver limited growth, and importantly, perform worse than the market. Taking a look back first, we see that the company grew earnings per share by an impressive 36% last year. The strong recent performance means it was also able to grow EPS by 481% in total over the last three years. So we can start by confirming that the company has done a great job of growing earnings over that time. Shifting to the future, estimates from the analysts covering the company suggest earnings growth is heading into negative territory, declining 24% per annum over the next three years. That's not great when the rest of the market is expected to grow by 9.8% each year. With this information, we are not surprised that Singapore Airlines is trading at a P/E lower than the market. However, shrinking earnings are unlikely to lead to a stable P/E over the longer term. There's potential for the P/E to fall to even lower levels if the company doesn't improve its profitability. What We Can Learn From Singapore Airlines' P/E? It's argued the price-to-earnings ratio is an inferior measure of value within certain industries, but it can be a powerful business sentiment indicator. As we suspected, our examination of Singapore Airlines' analyst forecasts revealed that its outlook for shrinking earnings is contributing to its low P/E. Right now shareholders are accepting the low P/E as they concede future earnings probably won't provide any pleasant surprises. It's hard to see the share price rising strongly in the near future under these circumstances. It's always necessary to consider the ever-present spectre of investment risk. We've identified 3 warning signs with Singapore Airlines (at least 1 which doesn't sit too well with us), and understanding them should be part of your investment process. It's important to make sure you look for a great company, not just the first idea you come across. So take a peek at this free list of interesting companies with strong recent earnings growth (and a low P/E). Mobile Infrastructure for Defense and DisasterThe next wave in robotics isn't humanoid. Its fully autonomous towers delivering 5G, ISR, and radar in under 30 minutes, anywhere.Get the investor briefing before the next round of contractsSponsored On Behalf of CiTech