With a median price-to-sales (or "P/S") ratio of close to 2.6x in the Diversified Financial industry in the United States, you could be forgiven for feeling indifferent about Global Blue Group Holding AG's (NYSE:GB) P/S ratio of 2.7x.  While this might not raise any eyebrows, if the P/S ratio is not justified investors could be missing out on a potential opportunity or ignoring looming disappointment.    

See our latest analysis for Global Blue Group Holding

NYSE:GB Price to Sales Ratio vs Industry December 28th 2023

How Has Global Blue Group Holding Performed Recently?

With revenue growth that's superior to most other companies of late, Global Blue Group Holding has been doing relatively well.   Perhaps the market is expecting this level of performance to taper off, keeping the P/S from soaring.  If the company manages to stay the course, then investors should be rewarded with a share price that matches its revenue figures.    

Keen to find out how analysts think Global Blue Group Holding's future stacks up against the industry? In that case, our free report is a great place to start.

Is There Some Revenue Growth Forecasted For Global Blue Group Holding?  

There's an inherent assumption that a company should be matching the industry for P/S ratios like Global Blue Group Holding's to be considered reasonable.  

Taking a look back first, we see that the company grew revenue by an impressive 76% last year.    Pleasingly, revenue has also lifted 79% in aggregate from three years ago, thanks to the last 12 months of growth.  Therefore, it's fair to say the revenue growth recently has been superb for the company.  

Turning to the outlook, the next year should generate growth of 22%  as estimated by the lone analyst watching the company.  Meanwhile, the rest of the industry is forecast to only expand by 5.2%, which is noticeably less attractive.

With this information, we find it interesting that Global Blue Group Holding is trading at a fairly similar P/S compared to the industry.  It may be that most investors aren't convinced the company can achieve future growth expectations.  

What Does Global Blue Group Holding's P/S Mean For Investors?

Generally, our preference is to limit the use of the price-to-sales ratio to establishing what the market thinks about the overall health of a company.

Despite enticing revenue growth figures that outpace the industry, Global Blue Group Holding's P/S isn't quite what we'd expect.  There could be some risks that the market is pricing in, which is preventing the P/S ratio from matching the positive outlook.  It appears some are indeed anticipating revenue instability, because these conditions should normally provide a boost to the share price.    

We don't want to rain on the parade too much, but we did also find 3 warning signs for Global Blue Group Holding (1 is a bit concerning!) that you need to be mindful of.  

If companies with solid past earnings growth is up your alley, you may wish to see this free collection of other companies with strong earnings growth and low P/E ratios.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.