Price-To-Sales Ratio - Price/Sales
- A ratio for valuing a stock relative to its own past performance, other companies or the market itself. Price to sales is calculated by dividing a stock's current price by its revenue per share for the trailing 12 months:
The ratio can also be referred to as a stock's "PSR".
The price-to-sales ratio can vary substantially across industries; therefore, it's useful mainly when comparing similar companies. Because it doesn't take any expenses or debt into account, the ratio is somewhat limited in the story it tells.
Investment dictionary. Academic. 2012.