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3 Stocks With Low Price-Sales Ratios

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Investors may want to consider the following stocks, as they have low price-sales ratios, high profitability and good financial conditions.

ViacomCBS Inc

The first company under consideration is ViacomCBS Inc (NASDAQ:VIAC), a New York-based global media and entertainment company.

The stock price was trading at around $23.30 per share at close on June 17 for a price-sales ratio of 0.41, which is better positioned than the industry median of 1.


ViacomCBS has a GuruFocus profitability rating of 8 out of 10, driven by an operating margin of 16.02% (versus the industry median of 4.52%) and a return on equity of 27.46% (versus the industry median of 2.65%). Furthermore, the return on assets is 6.55% (versus the industry median of 1.06%), the return on capital is 78.43% (compared to the industry median of 11.03%) and the three-year revenue growth rate is 15.3% while the industry median stands at 1.6%.

The company has received a moderate GuruFocus rating of 4 out of 10 for its financial strength. ViacomCBS has been more aggressive than most of its competitors in funding its growth with leverage. However, it is still able to pay its debt.

As a result of 53% decline over the past year, the stock has a market capitalization of $14.49 billion and a 52-week range of $10.10 to $53.71.

The stock holds an overweight recommendation rating on Wall Street.

CoreCivic Inc

The second company under consideration is CoreCivic Inc (NYSE:CXW), a Brentwood, Tennessee-based real estate investment trust company.

The stock price was trading at $10.43 per share at close on June 17 for a price-sales ratio of 0.63, which appeals more than the industry median of 6.35.

CoreCivic Inc has a GuruFocus profitability rating of 7 out of 10, driven by a return on equity of 13.61% (versus the industry median of 5.81%) and a return on assets of 5.08% (versus the industry median of 3.04%).

The company has received a moderate GuruFocus rating of 4 out of 10 for its financial strength. The balance sheet is characterized by a low cash-debt ratio of 0.05 (versus the industry median of 0.08), an debt-to-Ebitda ratio of 5.48 (versus the industry median of 6.7) and a Piotroski F-Score of 5 out of 9, indicating stable financial conditions.

Following a 56.3% share price decrease over the past year, the stock has a market capitalization of $1.25 billion and a 52-week range of $8.33 to $24.38.

The stock holds a buy recommendation rating on Wall Street.

Sally Beauty Holdings Inc

The third company under consideration is Sally Beauty Holdings Inc (NYSE:SBH), a Denton, Texas-based distributor of professional beauty products.

The stock price was trading at $13.34 per share at close on June 17 for a price-sales ratio of 0.42, which is better than the industry median of 0.51.

Sally Beauty has a GuruFocus profitability rating of 9 out of 10, driven by an operating margin of 10.04% (versus the industry median of 2.97%) and return on assets of 8.72% (versus the industry median of 1.61%). Also, the return on capital is 32.13% compared to the industry median of 8.16%.

Sally Beauty has received a moderate financial strength of 4 out of 10 from GuruFocus. The debt-to-equity ratio for the most recent quarter was -47.05, ranking higher than a total of 935 companies operating in the retail - cyclical industry. Also, the Piotroski F-Score of 5 out of 9 indicates that Sally Beauty Holdings is a financially stable company.

After a 9.5% share price decline over the past year, the stock has a market capitalization of $1.51 billion and a 52-week range of $6.28 to $21.98.

Wall Street sell-side analysts issued a hold recommendation rating for this stock.

Disclosure: I have no positions in any securities mentioned in this article.

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This article first appeared on GuruFocus.