Market value divided by annual revenue.
P/S is used mainly for companies without profits, such as young growth firms. It says nothing about profitability: a P/S of 2 can be cheap at a 30% margin and expensive at 2%.
Market value divided by annual revenue.
P/S is used mainly for companies without profits, such as young growth firms. It says nothing about profitability: a P/S of 2 can be cheap at a 30% margin and expensive at 2%.