Markets

How to Find Value Stocks Using the Price to Sales Ratio

Looking for a strategy to find the best value stocks? Tracey Ryniec, Stock Strategist at Zacks Investment Research, discusses how to find value stocks using the price-to-sales ratio and the Zacks Rank.

Many investors favor the P/S ratio over other value criteria because it measures sales, and not earnings, which are a lot harder for a company to manipulate.

Value investors want to be sure to buy a stock with a P/S ratio that is lower, preferably under 1.0.

Tracey ran her screens looking for Zacks Rank #1s with low P/S ratios and found Casey's General Stores, Inc. (CASY). This Midwestern convenience store chain is also the fifth largest pizza chain in the country. Its sales of prepared foods have been soaring as gasoline prices have declined and the consumer has more money to spend eating out.

The company also recently launched a new pizza ordering app making it even easier to order.

But what else should investors take away from Casey's? Tracey fills you in on all the fundamentals.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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