The Price to Sales Ratio, or PS Ratio, is a popular valuation ratio. It is the share price of a company divided by its sales per share. This is measured on a TTM basis and earnings are diluted and normalised.
Some argue that, since sales figures are less easy to manipulate than either earnings or book value, the price-to-sales ratio is a more reliable indicator of company value.
When EPS are negative or depressed temporarily the Price to Sales ratio can be a more useful indicator than the PE Ratio, and a low P/S can indicate a higher profit potential if the stock recovers. Some commentators have called it 'The King of the Value Factors' and look for P/S ratios of significantly less than 1.
It should be noted that the P/S ratio was abused during the dot com years to promote companies with no earnings or profits.
This is measured on a TTM basis and earnings are diluted and normalised.
Ticker | Name | P / S | StockRank™ |
---|---|---|---|
HKG:2012 | Sunshine Oilsands | -267113.45 | 62 |
ASX:OPT | Opthea | -8636.26 | 70 |
ASX:PEK | Peak Rare Earths | -1963.08 | 52 |
LON:TEEC | Triple Point Energy Efficiency Infrastructure | -1647.55 | 51 |
KRX:950210 | Prestige Biopharma | -1210.9 | 14 |
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