A Trio of Low Price-to-Median Price-Sales Stocks
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When looking for bargains, investors could be interested in the following three companies, as their stocks have low price-to-median-price-sales values when compared to the average of the S&P 500 (which stands at around 1.71 as of the writing of this article).
This approach is based on the idea that the stock valuation will revert to its historical (10-year) average in terms of the price-sales ratio. It requires investors to divide the current share price by the trailing twelve-month revenue per share times the 10-year median price-sales ratio.
Sell-side analysts have issued optimistic recommendation ratings for these companies, indicating that they expect higher share prices over the months ahead.
CenterPoint Energy Inc
The first stock investors could be interested in is CenterPoint Energy Inc (NYSE:CNP), a Houston, Texas-based provider of energy for domestic needs.
CenterPoint Energy Inc's price-to-median-price-sales value is 1.53 as of June 14, which ranks higher than 83 out of 318 companies that operate in the utilities-regulated industry.
The company's revenue per share for the trailing 12 months ended in March 2021 was $13.70. CenterPoint Energy Inc has a 10-year median price-sales ratio of 1.2355. Thus, the median price-sales value is $16.93 as of June 14.
The stock was trading at $25.98 per share at close on Monday for a market capitalization of $15.08 billion and a 52-week range of $17.34 to $26.18.
Currently, CenterPoint Energy Inc pays a quarterly dividend of 16 cents per common share with the last payment made on June 10. The stock grants a forward dividend yield of 2.47% as of June 14.
GuruFocus assigned a score of 3 out of 10 to the company's financial strength and 5 out of 10 to its profitability.
Wall Street recommends a median rating of overweight with an average target price of $27.15 per share for the stock.
Hasbro Inc
The second stock investors could be interested in is Hasbro Inc (NASDAQ:HAS). Based in Pawtucket, Rhode Island, the company is selling action figures, arts and crafts, game products and toys in North America, and is marketing and selling game products and toys internationally.
Hasbro Inc's price-to-median-price-sales value is 1.12 as of June 14, which ranks higher than 320 out of 426 companies that operate in the travel and leisure industry.
The revenue per share for the trailing 12 months ended in March 2021 was $39.86. Hasbro Inc has a 10-year median price-sales ratio of 2.1449. Thus, its median price-sales value is $85.50 as of June 14.
The stock was trading at $95.50 per share at close on Monday for a market capitalization of $13.14 billion and a 52-week range of $69.32 to $101.24.
Currently, Hasbro Inc pays a quarterly dividend of 68 cents per common share with the next payment to be issued on Aug. 16. The stock grants a forward dividend yield of 2.85% as of June 14.
GuruFocus assigned a score of 4 out of 10 to the company's financial strength and 7 out of 10 to its profitability.
Wall Street recommends a median rating of overweight for the stock with an average target price of $110.40 per share.
Advance Auto Parts Inc
The third stock investors could be interested in is Advance Auto Parts Inc (NYSE:AAP), a Raleigh, North Carolina-based operator of about 4,800 stores and 170 branches in North America and Puerto Rico for the sale of automotive spare parts, accessories, batteries and maintenance items.
Advance Auto Parts Inc's price-to-median-price-sales value is 1.03 as of June 14, which ranks higher than 333 out of 546 companies that operate in the retail and cyclical industry.
The revenue per share for the trailing 12 months ended in March 2021 was $157.94. Advance Auto Parts Inc has a 10-year median price-sales ratio of about 1.2159. Therefore, the median price-sales value is $192.04 as of June 14.
The stock price was trading at $198.59 per share on Monday for a market capitalization of $13 billion and a 52-week range of $130.33 to $210.18.
Starting July 2, Advance Auto Parts Inc is going to distribute $1 per common share every quarter, granting a forward dividend yield of 2.01% as of June 14.
GuruFocus assigned a score of 5 out of 10 to the company's financial strength and 6 out of 10 to its profitability.
Wall Street recommends a median rating of overweight with an average target price of $219.78 per share for the stock.
Disclosure: I have no position in any securities mentioned.
This article first appeared on GuruFocus.
