Bribery case in Kenya puts Shikun & Binui Energy under renewed scrutiny
Shikun & Binui Energy (TASE:SBEN) is back in the headlines after a $70 million bribery conviction in Kenya, as the wider group explores infrastructure projects in Somaliland and faces questions about governance and ethics.
Recent headlines around the Kenya conviction and Somaliland plans arrive as Shikun & Binui Energy’s share price has crept higher, with a 7-day share price return of 2.50% and year-to-date share price return of 8.12%, alongside a much stronger 1-year total shareholder return of 57.09%, which indicates that earlier momentum is now being reassessed under a fresh governance lens.
Compare Shikun & Binui Energy’s governance overhang with other companies by scanning a curated list of 223 resilient stocks with low risk scores that score better on risk and balance sheet strength.
Shikun & Binui Energy now trades with a strong 1-year total return on the table, alongside a fresh governance cloud overhead. Do the current risks and that recent climb still leave enough upside for new buyers as valuation comes into focus?
Preferred price-to-sales multiple: Is Shikun & Binui Energy’s premium justified?
Valuation now sits front and center. Shikun & Binui Energy trades on a P/S ratio of 11x, compared with an Israel construction industry average of 1.1x. This means the market is paying a far higher price for each ₪ of revenue than for sector peers.
The P/S multiple compares the market value of the equity with the revenue the business generates. For a power and infrastructure operator like Shikun & Binui Energy, investors often watch this measure when earnings are loss making, because it anchors sentiment to sales rather than profit that currently sits in the red.
Here the gap is extreme. SBEN is described as expensive on a P/S of 11x against both its construction industry benchmark and a peer average of 1.1x. This suggests investors are accepting a materially richer tag without supporting profitability, given the firm reported a net loss of ₪268.84m and carries a value score of 0.
That premium sits alongside other pressure points. Earnings have declined by 49.6% per year over the past 5 years, the company remains unprofitable, return on equity is negative at 14.11% and interest payments are not well covered by earnings. As a result, the valuation gap to the sector is hard to frame as conservative on the figures provided.
See what the numbers say about this price — find out in our valuation breakdown.
Result: Price-to-sales of 11x (OVERVALUED).
Still, the Kenya bribery conviction and the current loss of ₪268.84m could quickly change how investors frame Shikun & Binui Energy’s rich P/S tag.
Find out about the key risks to this Shikun & Binui Energy narrative.
Next Steps
If this all seems focused on the risks associated with Shikun & Binui Energy, consider this a prompt to review the data yourself and act quickly, starting with the 2 important warning signs.
Looking for more Shikun & Binui Energy style ideas?
If Shikun & Binui Energy’s valuation and governance questions have you reassessing your watchlist, now is the moment to widen your search before the next move gets crowded.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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