5 Low Price-to-Sales Stocks Positioned to Reap Higher Returns

Core Insights - The price-to-sales (P/S) ratio is highlighted as a valuable metric for evaluating companies, especially those with negative earnings or in early development stages, as it reflects how much investors pay for each dollar of revenue generated [2][3] - A P/S ratio below 1 indicates a potentially undervalued stock, making it a more attractive investment compared to those with higher ratios [2] - The P/S ratio is considered more reliable than the price-to-earnings (P/E) ratio, as sales figures are less susceptible to manipulation [3] Company Summaries - Lakeland Industries (LAKE): A global manufacturer of protective clothing, focusing on high-value products and market diversification. The company is committed to organic growth and has a Value Score of A with a Zacks Rank of 1 [6] - Caleres (CAL): Operates a portfolio of consumer-driven footwear brands and is capturing market share in the kids' segment. The company aims to reduce debt and has a Value Score of A with a Zacks Rank of 2 [7] - Ingredion (INGR): A global ingredient solutions provider, focusing on cost-saving initiatives and optimizing its supply chain. The company has a Value Score of A and a Zacks Rank of 2 [8] - ProPetro Holding Corp. (PUMP): An oilfield service provider in the Permian Basin, focusing on growth through acquisitions and pressure pumping services. The company has a debt-light balance sheet and a Value Score of A with a Zacks Rank of 2 [9] - Barrett Business Services (BBSI): Provides business management solutions for small and mid-sized companies, benefiting from an expanding client base and effective cost-management strategies. The company has a Value Score of A and a Zacks Rank of 2 [10] Screening Parameters - Companies with a P/S ratio less than the median for their industry are preferred, along with a P/E ratio and price-to-book ratio below their respective industry medians [4] - A debt-to-equity ratio lower than the industry median is also a key parameter, ensuring stability in the P/S ratio [4] - Stocks must be trading at a minimum price of $5 and have a Zacks Rank of 1 (Strong Buy) or 2 (Buy) to qualify for investment consideration [4]