A Top-Line Approach: The Price-to-Sales Ratio Screen
by Wayne A. Thorp
However, price-to-sales ratios (current stock price divided by sales per share for the last 12 months) truly came into their own during the dot-com era, as investors sought ways to value companies whose negative earnings made earnings-based models useless.
Several years after the bursting of the Internet bubble, price-to-sales ratios continue to be a useful stock selection methodology.
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