Shulou(Shulou.com)06/03 Report--

What this article shares with you is about what PS value is. The editor thinks it is very practical, so I share it with you to learn. I hope you can get something after reading this article. Without saying much, let's take a look at it with the editor.

PS value is a way of stock valuation, called market efficiency valuation method = total market capitalization / sales.

P is the stock price, S is the sales income per share, and P Price-to-Sales S may be divided by the total market value by sales, so the calculated value is called PS value.

The advantage of PS is that the sales revenue is the most stable and the volatility is low.

And operating income is not affected by depreciation, inventory, non-recurrent income and expenditure, and is not as easy to manipulate as profits.

Income will not be negative, there will be no meaningless situation, even if the net profit is negative.

Therefore, the price-to-sales ratio valuation method can form a good supplement with the price-earnings ratio valuation method.

The disadvantage of the price-to-sales ratio valuation method is that it can not reflect the company's cost control ability, even if the cost increases, profits decline, does not affect sales revenue, the price-to-sales ratio remains unchanged.

In addition, the market-to-sales ratio (PS) will decrease with the expansion of the company's sales revenue; for companies with larger operating income, the PS is lower.

Look at the potential value of the enterprise with PS to see whether its future profits can grow substantially. If the PS is low, it is possible to rise.

The lowest stock in PS is long-term bull stock. A book introduces a total of 20 stocks of three types in the United States in the past 20 years.

In the past 20 years, the three types of stocks have the lowest PS, the lowest PE and the lowest PB. Twenty years later, the stock with the lowest PE rose the least, followed by the lowest PB, and the lowest PS rose the most.

The above is what PS value is, the editor believes that there are some knowledge points that we may see or use in our daily work. I hope you can learn more from this article. For more details, please follow the industry information channel.

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