It's not a stretch to say that BILL Holdings, Inc.'s (NYSE:BILL) price-to-sales (or "P/S") ratio of 4.1x right now seems quite "middle-of-the-road" for companies in the Software industry in the United States, where the median P/S ratio is around 4.8x. However, investors might be overlooking a clear opportunity or potential setback if there is no rational basis for the P/S.
NYSE:BILL Price to Sales Ratio vs Industry August 14th 2024
How BILL Holdings Has Been Performing
BILL Holdings certainly has been doing a good job lately as it's been growing revenue more than most other companies. It might be that many expect the strong revenue performance to wane, which has kept the P/S ratio from rising. If the company manages to stay the course, then investors should be rewarded with a share price that matches its revenue figures.
Want the full picture on analyst estimates for the company? Then our free report on BILL Holdings will help you uncover what's on the horizon.
What Are Revenue Growth Metrics Telling Us About The P/S?
In order to justify its P/S ratio, BILL Holdings would need to produce growth that's similar to the industry.
Taking a look back first, we see that the company grew revenue by an impressive 29% last year. This great performance means it was also able to deliver immense revenue growth over the last three years. So we can start by confirming that the company has done a tremendous job of growing revenue over that time.
Looking ahead now, revenue is anticipated to climb by 17% each year during the coming three years according to the analysts following the company. Meanwhile, the rest of the industry is forecast to expand by 18% per year, which is not materially different.
In light of this, it's understandable that BILL Holdings' P/S sits in line with the majority of other companies. Apparently shareholders are comfortable to simply hold on while the company is keeping a low profile.
The Final Word
It's argued the price-to-sales ratio is an inferior measure of value within certain industries, but it can be a powerful business sentiment indicator.
We've seen that BILL Holdings maintains an adequate P/S seeing as its revenue growth figures match the rest of the industry. At this stage investors feel the potential for an improvement or deterioration in revenue isn't great enough to push P/S in a higher or lower direction. All things considered, if the P/S and revenue estimates contain no major shocks, then it's hard to see the share price moving strongly in either direction in the near future.
The company's balance sheet is another key area for risk analysis. Our free balance sheet analysis for BILL Holdings with six simple checks will allow you to discover any risks that could be an issue.
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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可以毫不夸张地说,BILL Holdings, Inc. (NYSE:BILL)的市销率目前为4.1倍,对于美国软件行业中的公司来说,这似乎是相当"普通"的水平,其中的中位数市销率约为4.8倍。然而,如果没有市销率的合理基础,投资者可能会忽视一个明显的机会或潜在的挫折。
纽交所:BILL股票的市销率与行业比较,2024年8月14日
BILL Holdings的表现如何
BILL Holdings最近一直做得很好,因为它的营业收入增长幅度超过了大多数其他公司。也许很多人预计强劲的营收业绩会减弱,这也使得市销率没有上升。如果公司能够保持目前的进展,那么投资者应该会得到一个与其营业收入数据相匹配的股价奖励。