Switch to:
Cisco Systems Inc (NAS:CSCO)
Median P/S Value
$32.29 (As of Today)

This valuation method assumes that the stock valuation will revert to its historical mean in terms of Price/Sales Ratio. The reason we use P/S Ratio instead of P/E Ratio or P/B Ratio is because Price/Sales Ratio is independent of profit margin, and can be applied to a broader range of situations.

Median P/S Value is calculated as trailing twelve months (TTM) revenue per share times 10-Year median P/S ratio. Cisco Systems Inc's revenue per share for the trailing twelve months (TTM) ended in Oct. 2014 was $9.07. Cisco Systems Inc's 10-Year median P/S ratio is 3.56. Therefore, the Median P/S Value for today is $32.29.

As of today, Cisco Systems Inc's share price is $27.77. Cisco Systems Inc's median P/S value is $32.29. Therefore, Cisco Systems Inc's Price to Median P/S Value Ratio for today is 0.90.

CSCO' s 10-Year Price to Median P/S Value Range
Min: 0.53   Max: 8.61
Current: 0.9

0.53
8.61

During the past 13 years, the highest Price to Median P/S Value Ratio of Cisco Systems Inc was 8.61. The lowest was 0.53. And the median was 1.46.

CSCO's Price to Median P/S Value is ranked higher than
84% of the 758 Companies
in the Global Communication Equipment industry.

( Industry Median: 1.11 vs. CSCO: 0.90 )

Definition

Cisco Systems Inc's Median P/S Value for today is calculated as

Median P/S Value=Total Annual Sales / Shares Outstanding*10-Year Median P/S Ratio
=Revenue per Share (TTM)*10-Year Median P/S Ratio
=9.07*3.56
=32.29

10-Year Median P/S Ratio is 3.56.
Cisco Systems Inc's revenue per share for the trailing twelve months (TTM) ended in Oct. 2014 was 2.09 (Jan. 2014 ) + 2.23 (Apr. 2014 ) + 2.38 (Jul. 2014 ) + 2.37 (Oct. 2014 ) = $9.07.

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.


Explanation

This valuation method assumes that the stock valuation will revert to its historical mean in terms of Price/Sales Ratio. The reason we use P/S Ratio instead of P/E Ratio or P/B Ratio is because Price/Sales Ratio is independent of profit margin, and can be applied to a broader range of situations.

It also assumes that over time the profit margin is constant. If a company increases its profit margin to a sustainable level, this value might under-estimate its value. If it has permanent declined profit margins, this may over-estimate the company’s value.

Cisco Systems Inc's Price to Median P/S Value Ratio for today is calculated as

Price to Median P/S Value=Share Price/Median P/S Value
=27.77/32.29
=0.86

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.


Related Terms

P/E Ratio, P/B Ratio, P/S Ratio, Intrinsic Value (DCF Projected), Intrinsic Value (DCF), Intrinsic Value (DE), Graham Number, GAVA


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Cisco Systems Inc Annual Data

Jul05Jul06Jul07Jul08Jul09Jul10Jul11Jul12Jul13Jul14
medpsvalue 13.3916.1619.8622.8621.8924.3927.5930.3032.1831.79

Cisco Systems Inc Quarterly Data

Jul12Oct12Jan13Apr13Jul13Oct13Jan14Apr14Jul14Oct14
medpsvalue 30.3030.8331.2931.8332.1832.1831.5831.4331.7932.29
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK