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Dow Chemical Co (NYSE:DOW)
Median P/S Value
$34.97 (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. Dow Chemical Co's revenue per share for the trailing twelve months (TTM) ended in Dec. 2013 was $46.01. Dow Chemical Co's 10-Year median P/S ratio is 0.76. Therefore, the Median P/S Value for today is $34.97.

As of today, Dow Chemical Co's share price is $49.37. Dow Chemical Co's median P/S value is $34.97. Therefore, Dow Chemical Co's Price to Median P/S Value Ratio for today is 1.41.

DOW' s 10-Year Price to Median P/S Value Range
Min: 0.32   Max: 1.98
Current: 1.41

0.32
1.98

During the past 13 years, the highest Price to Median P/S Value Ratio of Dow Chemical Co was 1.98. The lowest was 0.32. And the median was 1.26.

DOW's Price to Median P/S Value is ranked higher than
57% of the 915 Companies
in the Global Chemicals industry.

( Industry Median: 1.10 vs. DOW: 1.41 )

Definition

Dow Chemical Co'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
=46.01*0.76
=34.97

10-Year Median P/S Ratio is 0.76.
Dow Chemical Co's revenue per share for the trailing twelve months (TTM) ended in Dec. 2013 was 12.11 (Mar. 2013 ) + 11.32 (Jun. 2013 ) + 11.5 (Sep. 2013 ) + 11.08 (Dec. 2013 ) = $46.01.

* 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.

Dow Chemical Co'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
=49.37/34.97
=1.41

* 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.

Dow Chemical Co Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
medpsvalue 32.0335.9938.3242.1346.4432.2535.6439.2836.6934.97

Dow Chemical Co Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
medpsvalue 39.1139.2839.2038.0736.9736.6936.3235.5535.5134.97
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