EV/Sales

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Enterprise value/sales is a financial ratio that compares the total value (as measured by enterprise value) of the company to its sales. The ratio is, strictly speaking, nominated in years; it demonstrates how many dollars of EV are generated by one dollar of yearly sales. Generally, the lower the ratio, the cheaper the company is.[1] Some investment professionals believe—as enterprise value and sales both consider debt and equity holders—EV/Sales is superior to the oft quoted price/sales ratio.[2]

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