or
Remember me
Back
Jefe127 wrote: How the Price-To-Sales Ratio Works The price-to-sales ratio (Price/Sales or P/S) is calculated by taking a company's market capitalization (the number of outstanding shares multiplied by the share price) and divide it by the company's total sales or revenue over the past 12 months. The lower the P/S ratio, the more attractive the investment. Price-to-sales provides a useful measure for sizing up stocks. The price-to-sales ratio utilizes a company's market capitalization and revenue to determine whether the stock is valued properly. How P/S Is Useful The price-to-sales ratio shows how much the market values every dollar of the company's sales. This ratio can be effective in valuing growth stocks that have yet to turn a profit or have suffered a temporary setback. For example, if a company isn't earning a profit yet, investors can look at the P/S ratio to determine whether the stock is undervalued or overvalued. If the P/S ratio is lower than comparable companies in the same industry that is profitable, investors might consider buying the stock due to the low valuation. Of course, the P/S ratio needs to be used with other financial ratios and metrics when determining whether a stock is valued properly. https://www.investopedia.com/articles/fundamental/03/032603.asp GO HEXO, BUY and HOLD!!!
The price-to-sales ratio (Price/Sales or P/S) is calculated by taking a company's market capitalization (the number of outstanding shares multiplied by the share price) and divide it by the company's total sales or revenue over the past 12 months. The lower the P/S ratio, the more attractive the investment. Price-to-sales provides a useful measure for sizing up stocks.
The price-to-sales ratio utilizes a company's market capitalization and revenue to determine whether the stock is valued properly.
The price-to-sales ratio shows how much the market values every dollar of the company's sales. This ratio can be effective in valuing growth stocks that have yet to turn a profit or have suffered a temporary setback.
For example, if a company isn't earning a profit yet, investors can look at the P/S ratio to determine whether the stock is undervalued or overvalued. If the P/S ratio is lower than comparable companies in the same industry that is profitable, investors might consider buying the stock due to the low valuation. Of course, the P/S ratio needs to be used with other financial ratios and metrics when determining whether a stock is valued properly. https://www.investopedia.com/articles/fundamental/03/032603.asp GO HEXO, BUY and HOLD!!!