The Price/Sales (P/S) Ratio is a financial metric that compares a company's market capitalization to its revenue. It is used to evaluate the valuation of a company, especially in industries where companies may not yet be profitable. A lower P/S ratio might indicate the company is undervalued, while a higher ratio could suggest it is overvalued. This ratio is beneficial for comparing companies within the same industry. However, it doesn't consider profitability, so it should be analyzed alongside other financial metrics.
