What is the Price to Sales Ranking (PSR)?
PSR stands for Price to Sales Ranking. A number of important academic studies have determined that the Price/Sales Ratio is the most reliable method of identifying stocks for long term appreciation. Stocks with the lowest Price/Sales Ratio generally represent the greatest Values. To determine the Ranking, the Price/Sales Ratio is calculated each week by dividing the current weekly closing price by the total of the last four quarters of sales. Then, the ratios for all stocks are sorted on a percentage basis on a scale of zero to 99. Those stocks with the lowest Price/Sales Ratio receive a Price to Sales Ranking of 99, and stocks with the highest Price/Sales Ratio receive a Price to Sales Ranking of zero.