Amprius Technologies, Inc. (NYSE:AMPX) shares have continued their recent momentum with a 44% gain in the last month alone. Unfortunately, the gains of the last month did little to right the losses of the last year with the stock still down 46% over that time.

After such a large jump in price, you could be forgiven for thinking Amprius Technologies is a stock to steer clear of with a price-to-sales ratios (or "P/S") of 10.5x, considering almost half the companies in the United States' Electrical industry have P/S ratios below 1.7x. However, the P/S might be quite high for a reason and it requires further investigation to determine if it's justified.

How Amprius Technologies Has Been Performing

Amprius Technologies certainly has been doing a good job lately as it's been growing revenue more than most other companies. The P/S is probably high because investors think this strong revenue performance will continue. If not, then existing shareholders might be a little nervous about the viability of the share price.

How Is Amprius Technologies' Revenue Growth Trending?

Amprius Technologies' P/S ratio would be typical for a company that's expected to deliver very strong growth, and importantly, perform much better than the industry.

If we review the last year of revenue growth, the company posted a terrific increase of 196%. Spectacularly, three year revenue growth has ballooned by several orders of magnitude, thanks in part to the last 12 months of revenue growth. Therefore, it's fair to say the revenue growth recently has been superb for the company.

Shifting to the future, estimates from the seven analysts covering the company suggest revenue should grow by 134% per year over the next three years. That's shaping up to be materially higher than the 26% each year growth forecast for the broader industry.

With this in mind, it's not hard to understand why Amprius Technologies' P/S is high relative to its industry peers. Apparently shareholders aren't keen to offload something that is potentially eyeing a more prosperous future.

The Bottom Line On Amprius Technologies' P/S

Shares in Amprius Technologies have seen a strong upwards swing lately, which has really helped boost its P/S figure. Using the price-to-sales ratio alone to determine if you should sell your stock isn't sensible, however it can be a practical guide to the company's future prospects.

Our look into Amprius Technologies shows that its P/S ratio remains high on the merit of its strong future revenues. At this stage investors feel the potential for a deterioration in revenues is quite remote, justifying the elevated P/S ratio. Unless the analysts have really missed the mark, these strong revenue forecasts should keep the share price buoyant.

And what about other risks? Every company has them, and we've spotted 5 warning signs for Amprius Technologies (of which 2 don't sit too well with us!) you should know about.

If these risks are making you reconsider your opinion on Amprius Technologies, explore our interactive list of high quality stocks to get an idea of what else is out there.

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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.