Petco Health and Wellness Company, Inc. (NASDAQ:WOOF) shareholders would be excited to see that the share price has had a great month, posting a 62% gain and recovering from prior weakness. Looking further back, the 17% rise over the last twelve months isn't too bad notwithstanding the strength over the last 30 days.
Although its price has surged higher, it's still not a stretch to say that Petco Health and Wellness Company's price-to-sales (or "P/S") ratio of 0.2x right now seems quite "middle-of-the-road" compared to the Specialty Retail industry in the United States, where the median P/S ratio is around 0.4x. Although, it's not wise to simply ignore the P/S without explanation as investors may be disregarding a distinct opportunity or a costly mistake.
What Does Petco Health and Wellness Company's P/S Mean For Shareholders?
Recent times haven't been great for Petco Health and Wellness Company as its revenue has been rising slower than most other companies. It might be that many expect the uninspiring revenue performance to strengthen positively, which has kept the P/S ratio from falling. However, if this isn't the case, investors might get caught out paying too much for the stock.
If you'd like to see what analysts are forecasting going forward, you should check out our free report on Petco Health and Wellness Company.
Is There Some Revenue Growth Forecasted For Petco Health and Wellness Company?
The only time you'd be comfortable seeing a P/S like Petco Health and Wellness Company's is when the company's growth is tracking the industry closely.
If we review the last year of revenue, the company posted a result that saw barely any deviation from a year ago. Still, the latest three year period was better as it's delivered a decent 14% overall rise in revenue. Accordingly, shareholders probably wouldn't have been overly satisfied with the unstable medium-term growth rates.
Turning to the outlook, the next three years should generate growth of 1.0% each year as estimated by the analysts watching the company. That's shaping up to be materially lower than the 5.6% per annum growth forecast for the broader industry.
With this information, we find it interesting that Petco Health and Wellness Company is trading at a fairly similar P/S compared to the industry. It seems most investors are ignoring the fairly limited growth expectations and are willing to pay up for exposure to the stock. These shareholders may be setting themselves up for future disappointment if the P/S falls to levels more in line with the growth outlook.
The Bottom Line On Petco Health and Wellness Company's P/S
Its shares have lifted substantially and now Petco Health and Wellness Company's P/S is back within range of the industry median. 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.
Given that Petco Health and Wellness Company's revenue growth projections are relatively subdued in comparison to the wider industry, it comes as a surprise to see it trading at its current P/S ratio. When we see companies with a relatively weaker revenue outlook compared to the industry, we suspect the share price is at risk of declining, sending the moderate P/S lower. A positive change is needed in order to justify the current price-to-sales ratio.
There are also other vital risk factors to consider and we've discovered 2 warning signs for Petco Health and Wellness Company (1 is a bit unpleasant!) that you should be aware of before investing here.
Of course, profitable companies with a history of great earnings growth are generally safer bets. So you may wish to see this free collection of other companies that have reasonable P/E ratios and have grown earnings strongly.
Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com. 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.
Petco Health and Wellness Company, Inc.(NASDAQ:WOOF)の株主は、株価が素晴らしい月を過ごし、62%の上昇を記録し、先行弱さから回復していることに興奮するでしょう。さらに遡ると、過去十二か月の17%の上昇は、過去30日間の強さにもかかわらず、悪くありません。
価格が急上昇したにもかかわらず、今のPetco Health and Wellness Companyの売上高倍率(P/S)比率が0.2倍であることは、アメリカ合衆国の専門小売業種全体の中央値P/S比率の0.4倍と比較してかなり「まあまあ」なようです。ただし、投資家がP/S比率を説明なしで無視するのは賢明ではなく、独自の機会や高価なミスを無視しているかもしれません。
Petco Health and Wellness CompanyのP/S比率は株主にとってどのような意味を持つのでしょうか?
最近の状況はPetco Health and Wellness Companyにとってあまり良いものではありませんでした。売上高が他の多くの企業よりも遅く増加しているため、地味な売上高の成績が好転することを期待する多くの人々がいるかもしれません。これが事実でない場合、投資家は株式に高値を支払うことになるかもしれません。
今後のアナリストの予測を見たい場合は、Petco Health and Wellness Companyに関する無料レポートをチェックしてみてください。
ペットコ・ヘルス・アンド・ウェルネス・カンパニーには売上高の成長予測がありますか?
Petco Health and Wellness CompanyのようなP/Sを見るのは、成長が業種に密接に追従しているときだけです。
この情報を基に、Petco Health and Wellness Companyが業界とかなり似たP/Sで取引されているのは興味深いと考えられます。ほとんどの投資家は、比較的限られた成長期待を無視し、株への露出を高く評価しています。これらの株主は、P/Sが成長見通しにより適合する水準に下がると、将来失望する可能性があります。
オーストラリアでは、moomooの投資商品及びサービスはMoomoo Securities Australia Limitedによって提供され、オーストラリア証券投資委員会(ASIC)の管理を受けております(AFSL No. 224663)。「金融サービスガイド」、「利用規約」、「プライバシーポリシー」などの詳細は、Moomoo Securities Australia Limitedのウェブサイトhttps://www.moomoo.com/auでご確認いただけます。
オーストラリアでは、moomooの投資商品及びサービスはMoomoo Securities Australia Limitedによって提供され、オーストラリア証券投資委員会(ASIC)の管理を受けております(AFSL No. 224663)。「金融サービスガイド」、「利用規約」、「プライバシーポリシー」などの詳細は、Moomoo Securities Australia Limitedのウェブサイトhttps://www.moomoo.com/auでご確認いただけます。