Price-to-sales (P/S): what it is and how to read it
It compares the company's market value with its annual revenue. It helps when the company is not profitable yet or its earnings are not representative, because there is almost always revenue.
How it is calculated
Price-to-sales = market cap / revenue over the last 12 months.
How to read it
A price-to-sales of 1 means the company is worth on the market what it sells in a year. What is reasonable depends on margins: a company keeping 30% of each sale deserves a much higher multiple than one keeping 3%.
Price-to-sales in the MeridIAn ranking
Among the 2,076 companies in the ranking with data, the median Price-to-sales is 2.6: half are below and half above. The lowest 25% are below 1.2 and the highest 25% above 5.0.
For example: NVIDIA, 18.4; Apple, 10.6; Alphabet, 9.6; Banco Santander, 3.6.
By sector
| Sector | Median | Companies with data |
|---|---|---|
| Basic Materials | 2.2 | 139 |
| Communication Services | 2.0 | 100 |
| Consumer Cyclical | 1.3 | 225 |
| Consumer Defensive | 1.2 | 124 |
| Energy | 1.9 | 100 |
| Financial Services | 3.5 | 345 |
| Healthcare | 3.4 | 198 |
| Industrials | 2.0 | 383 |
| Real Estate | 6.3 | 100 |
| Technology | 5.0 | 271 |
| Utilities | 2.7 | 91 |
Lowest Price-to-sales
What to watch out for
It ignores both costs and debt. Two companies with the same price-to-sales can be very different if one has high margins and the other loses money.
Related metrics
All metrics in the glossary → · Stocks by sector and country → · Ready-made screeners →
General information for educational purposes, not investment advice. Figures from the latest weekly analysis (Oct 8, 2026) with the latest available price.