Sales Multiple Calculator

 

What is the Market Value? $ What is the Total Sales? $

Sales Multiple Calculator helps calculating the Sales Multiple

What is Sales Multiple?

The Sales Multiple (often shortened to the P/S ratio) is the ratio of a company's stock price to the company's Sales per share.

The Sales Multipleratio is used in valuing companies.

The Formula of Sales Multiple

Sales Multiple = Market Value / Sales

OR:

Sales Multiple = Market Value per Share / Sales per Share

Example of Sales Multiple

For example, if the market value of stocks equals 1,000,000 dollars and the Sales - 100,000 dollars, the Sales Multiple ratio is 10

1,000,000 / 100,000

The Meaning is: an investor who buys the company for 1 million dollars, should wait for 10 years till he earns his money

The reason is - the company sales only 100,000 dollars per year.

interperating Sales Multiple

A lower Sales Multiple is better