Calculate the price to sales ratio (P/S), a valuation ratio that compares a company’s market capitalization to its total revenue.

The price to sales ratio is particularly useful for valuing companies that are not yet profitable (and therefore have no meaningful P/E ratio), since revenue is typically positive even when earnings are not, and is less susceptible to accounting distortions than earnings-based multiples. It is, however, less informative than earnings- or cash-flow-based multiples for mature, profitable companies since it ignores profitability and cost structure entirely.

The formula is as follows:

\[\text{Price to Sales Ratio} = \text{Market Cap} / \text{Revenue}\]

Also known as: P/S ratio, sales multiple.

No programming experience? With the Finance Toolkit MCP server, AI assistants such as Claude and ChatGPT can calculate the Price to Sales Ratio (PS) for you. Just ask in plain English.

Calculate the Price to Sales Ratio (PS) in Python

The Price to Sales Ratio (PS) is available in the Ratios module of the open-source Finance Toolkit. Install it with:

pip install financetoolkit -U

Then call get_price_to_sales_ratio as shown below.

from financetoolkit import Toolkit

toolkit = Toolkit(["AAPL", "TSLA"], api_key="FINANCIAL_MODELING_PREP_KEY")

price_to_sales_ratio = toolkit.ratios.get_price_to_sales_ratio()

Parameters

get_price_to_sales_ratio accepts the following parameters:

  • show_daily (bool, optional): Whether to show daily data. Defaults to False.
  • diluted (bool, optional): Whether to use diluted shares in the calculation. Defaults to True.
  • rounding (int, optional): The number of decimals to round the results to. Defaults to 4.
  • growth (bool, optional): Whether to calculate the growth of the ratios. Defaults to False.
  • lag (int | str, optional): The lag to use for the growth calculation. Defaults to 1.
  • standardize (bool, optional): Whether to standardize (Z-Score) the result. When combined with growth=True, standardizes the growth values instead of the raw values. Defaults to False.
  • trailing (int): Defines whether to select a trailing period. E.g. when selecting 4 with quarterly data, the TTM is calculated.
EV to EBITDA Ratio EV to Operating Cashflow Ratio Earnings Yield Dividend Payout Ratio Reinvestment Rate Tangible Asset Value Net Current Asset Value EV to EBIT EV to Free Cash Flow Ratio Buyback Yield Shareholder Yield SBC Adjusted Free Cash Flow

The Ratios module page introduces the module, and the sidebar lists all of its functions.

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