What is a fair price to sales?

While the ideal ratio depends on the company and industry, the P/S ratio is typically good when the value falls between one and two. A price-to-sales ratio with a value less than one is better.

What is a good P E ratio?

Typically, the average P/E ratio is around 20 to 25. Anything below that would be considered a good price-to-earnings ratio, whereas anything above that would be a worse P/E ratio. But it doesn't stop there, as different industries can have different average P/E ratios.

What is a good cost to sales ratio?

In general, a lower expense-to-sales ratio is considered better, as it indicates that a company is spending less of its sales revenue on expenses and may be more profitable. For a consumer company, the expense-to-sales ratio should be between 25% and 30% of net sales.

What is a good value sales ratio?

EV-to-sales multiples are usually found to be between 1x and 3x. Generally, a lower EV/sales multiple will indicate that a company may be more attractive or undervalued in the market.

What is a good PB value?

What is a Good Price to Book Value Ratio? Value investors often prefer values lower than 1.0, which suggests that an undervalued stock may have been found. The benchmark for certain value investors, however, may frequently be equities with a less strict P/B value of less than 3.0.

Price to Sales Ratio Explained | Finance in 5 Minutes!

What is the justified PB ratio?

A stock's justified P/B ratio is related to expected future residual income. A closely related concept is Tobin's q, the ratio of the market value of debt and equity to the replacement cost of total assets. The denominator uses total assets and is valued at replacement costs.

Why is a low PB ratio good?

The lower a company's price-to-book ratio is, the better a value it generally is. This can be especially true if a stock's book value is less than one, meaning that it trades for less than the value of its assets. Buying a company's stock for less than book value can create a "margin of safety" for value investors.

Is 4 a good price to sales ratio?

Generally speaking, all things considered equal, a lower price to sales ratio is considered favorable as it indicates undervaluation. More specifically, if the ratio is less than one, it is considered good and anything above 4 is a warning sign that the company is overvalued.

What is Amazon's price to sales ratio?

P/S ratio as of November 2023 (TTM): 2.74

According to Amazon's latest financial reports and stock price the company's current price-to-sales ratio (TTM) is 2.73651. At the end of 2023 the company had a P/S ratio of 2.37.

How do you interpret the price-to-sales ratio?

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.

What is a good gross profit margin?

On the face of it, a gross profit margin ratio of 50 to 70% would be considered healthy, and it would be for many types of businesses, like retailers, restaurants, manufacturers and other producers of goods.

What is the average profit to sales ratio?

But in general, a healthy profit margin for a small business tends to range anywhere between 7% to 10%. Keep in mind, though, that certain businesses may see lower margins, such as retail or food-related companies. That's because they tend to have higher overhead costs.

Is 30 a bad PE ratio?

A P/E of 30 is high by historical stock market standards. This type of valuation is usually placed on only the fastest-growing companies by investors in the company's early stages of growth. Once a company becomes more mature, it will grow more slowly and the P/E tends to decline.

Is 200 a high PE ratio?

A P/E ratio of 200 is high. But it is basically saying that people expect the company to grow earnings to be 15 to 20 times as large as they are now (so the P/E ratio would be 10 to 15). If you don't think that the company has that kind of potential, don't invest.

Is 0.5 a good PE ratio?

A PEG ratio 0.5 means a stock is a strong BUY. Whereas a PEG ratio of more than 2 means the stock is highly overvalued and is a strong SELL. But PEG ratio also comes with limitations. It is dependent on a company's future growth rate, which is uncertain.

What is the price to sales ratio of the Nasdaq?

According to Nasdaq's latest financial reports and stock price the company's current price-to-sales ratio (TTM) is 5.30319. At the end of 2023 the company had a P/S ratio of 3.98.

What is the price to sales ratio of the S&P 500?

S&P 500 Price to Sales was 2.48 as of 2023-11-29, according to S&P Dow Jones Indices. Historically, S&P 500 Price to Sales reached a record high of 3.17 and a record low of 0.65, the median value is 1.56. Typical value range is from 1.79 to 2.57. The Year-Over-Year growth is 7.57%.

What is the price-to-sales ratio of Nvidia?

P/S ratio as of November 2023 (TTM): 37.4

According to NVIDIA's latest financial reports and stock price the company's current price-to-sales ratio (TTM) is 37.3965. At the end of 2023 the company had a P/S ratio of 35.3.

What is Apple price-to-book ratio?

P/B ratio as of December 2023 : 47.5

According to Apple's latest financial reports the company has a price-to-book ratio of 47.5. The price-to-book ratio is a way to measure how much the stock market thinks a company is worth compared to how much the company says its assets are worth on paper.

Which is better PE or PB ratio?

While the P/E Ratio is based on the company's earnings, the P/B ratio takes its book value instead. It indicates the amount of money an investor has to invest in the net assets of the company. Since the market value of a share is usually higher than its book value, the P/B is typically greater than 1.

What does a low PB mean?

Definition. Low blood pressure occurs when blood pressure is much lower than normal. This means the heart, brain, and other parts of the body may not get enough blood. Normal blood pressure is mostly between 90/60 mmHg and 120/80 mmHg. The medical word for low blood pressure is hypotension.

How do you calculate fair PE?

The P/E ratio is calculated by dividing the market value price per share by the company's earnings per share. A high P/E ratio can mean that a stock's price is high relative to earnings and possibly overvalued. A low P/E ratio might indicate that the current stock price is low relative to earnings.

How do you increase your PB ratio?

We can improve the P/B ratio by switching the denominator to tangible book value.

What is the difference between PB ratio and PS ratio?

The P/B ratio differs from other market multiple ratios such as the P/E ratio and P/S ratio, in that the P/B ratio measures a company's market value to its book value, while the P/E ratio only takes into account the stock price and earnings, and the P/S ratio only measures a company's stock price relative to revenue.