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    Smart Organic AD's (BUL:SO) Popularity With Investors Under Threat As Stock Sinks 46%

    Simply Wall St·01/02/2026 04:48:58
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    The Smart Organic AD (BUL:SO) share price has fared very poorly over the last month, falling by a substantial 46%. The drop over the last 30 days has capped off a tough year for shareholders, with the share price down 29% in that time.

    Even after such a large drop in price, Smart Organic AD may still be sending bearish signals at the moment with its price-to-earnings (or "P/E") ratio of 14.4x, since almost half of all companies in Bulgaria have P/E ratios under 11x and even P/E's lower than 4x are not unusual. Although, it's not wise to just take the P/E at face value as there may be an explanation why it's as high as it is.

    We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free.

    Smart Organic AD has been doing a good job lately as it's been growing earnings at a solid pace. One possibility is that the P/E is high because investors think this respectable earnings growth will be enough to outperform the broader market in the near future. You'd really hope so, otherwise you're paying a pretty hefty price for no particular reason.

    Check out our latest analysis for Smart Organic AD

    pe-multiple-vs-industry
    BUL:SO Price to Earnings Ratio vs Industry January 2nd 2026
    We don't have analyst forecasts, but you can see how recent trends are setting up the company for the future by checking out our free report on Smart Organic AD's earnings, revenue and cash flow.

    Is There Enough Growth For Smart Organic AD?

    The only time you'd be truly comfortable seeing a P/E as high as Smart Organic AD's is when the company's growth is on track to outshine the market.

    If we review the last year of earnings growth, the company posted a worthy increase of 13%. This was backed up an excellent period prior to see EPS up by 54% in total over the last three years. Accordingly, shareholders would have probably welcomed those medium-term rates of earnings growth.

    This is in contrast to the rest of the market, which is expected to grow by 21% over the next year, materially higher than the company's recent medium-term annualised growth rates.

    In light of this, it's alarming that Smart Organic AD's P/E sits above the majority of other companies. Apparently many investors in the company are way more bullish than recent times would indicate and aren't willing to let go of their stock at any price. Only the boldest would assume these prices are sustainable as a continuation of recent earnings trends is likely to weigh heavily on the share price eventually.

    What We Can Learn From Smart Organic AD's P/E?

    Despite the recent share price weakness, Smart Organic AD's P/E remains higher than most other companies. Typically, we'd caution against reading too much into price-to-earnings ratios when settling on investment decisions, though it can reveal plenty about what other market participants think about the company.

    Our examination of Smart Organic AD revealed its three-year earnings trends aren't impacting its high P/E anywhere near as much as we would have predicted, given they look worse than current market expectations. Right now we are increasingly uncomfortable with the high P/E as this earnings performance isn't likely to support such positive sentiment for long. Unless the recent medium-term conditions improve markedly, it's very challenging to accept these prices as being reasonable.

    You should always think about risks. Case in point, we've spotted 2 warning signs for Smart Organic AD you should be aware of, and 1 of them is significant.

    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).