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Alberto Abaterusso
Alberto Abaterusso
Articles (2279) 

A Trio of Stocks With Low Price-Sales Ratios

These profitable businesses enjoy solid financials

May 24, 2020 | About:

Investors may be interested in the following stocks, as they have low price-sales ratios, high profitability and solid balance sheets.

Calloway's Nursery Inc

The first company that meets the above-mentioned criteria is Calloway's Nursery Inc (CLWY), a Fort Worth, Texas-based operator of garden centers in the US.

The stock was trading at a price of $5.40 per share at close on May 22 for a price-sales ratio of 0.7, which is higher than the industry median of 0.47.

Calloway's Nursery has a GuruFocus profitability rating of 7 out of 10, a three-year Ebitda growth rate of 28.1% (versus the industry median of 6.05%) and a three-year EPS without NRI growth rate of 46.7% (versus the industry median of 4.8%).

The company has received a positive GuruFocus rating of 6 out of 10 for its financial strength. The Piotroski F-Score of 4 out of 9 indicates that the financial situation is stable.

As a result of a 20% stock price decline over the past year, the stock has a market cap of $39.74 million and a 52-week range of $3.25 to $8.

Luxfer Holdings PLC

The second company that meets the above-mentioned criteria is Luxfer Holdings PLC (NYSE:LXFR), a British supplier of high-performance materials and high-pressure gas cylinders to companies that operate in several industries.

The stock price was trading at $14.20 per share at close on May 22 for a price-sales ratio of 0.93, which is on par with the industry median.

Luxfer Holdings has a GuruFocus profitability rating of 7 out of 10, driven by an operating margin of 10.75% versus the industry median of 6.15%.

The company has received a positive GuruFocus rating of 5 out of 10 for its financial strength. The Piotroski F-score of 5 out of 10 indicates that the company's financial situation is stable. The Altman Z-Score of 3.06 (greater than 2.99) tells that the company has a low likelihood of bankruptcy for the next two years. 

As a result of a 42.7% share price decline over the past year, the stock has a market capitalization of $406.80 million and a 52-week range of $10.27 to $26.25.

Wall Street sell-side analysts recommend an overweight rating for this stock and have established an average target price of $20.17 per share.

CDW Corp

The third company that meets the above-mentioned criteria is CDW Corp (NASDAQ:CDW), a Lincolnshire, Illinois-based provider of integrated information technology solutions to several private and public organizations in North America and the United Kingdom.

The stock was trading at $105.74 per share at close on May 22 for a price-sales ratio of 0.84 versus the industry median of 1.94.

CDW has a GuruFocus profitability rating of 8 out of 10. The company has a return on equity ratio of 80.86% (versus the industry median of 5.1%), a return on total assets of 9.51% (versus the industry median of 2.08%) and a return on capital of 153.46% (versus the industry median of 18.85%).

CDW has received a GuruFocus score of 5 out of 10 for its financial strength. The Piotroski F-Score of 8 out of 10 indicates that CDW is a financially stable company. The Altman Z-Score of 3.73 (greater than 2.99) indicates low risk of bankruptcy for the next two years.

As a result of a 2.5% share price increase over the past year, the stock has a market cap of $15.05 billion and a 52-week range of $73.39 to $146.09.

Wall Street sell-side analysts recommend an overweight rating for this stock and have established an average target price of $116.86 per share.

Disclosure: I have no positions in any securities mentioned in this article.

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About the author:

Alberto Abaterusso
I am a contributor at GuruFocus. I primarily write about gold, silver and precious metals mining industries. My articles have also been widely linked by popular sites, including MarketWatch, Financial Times, 24hGold, Investopedia, Financial.org, CNBS, MSN Money, Zachs, Reuters and others. I hold a Master's Degree in Business Administration from Università degli Studi di Bari (Italy), Aldo Moro. I am based in The Netherlands.

You can follow me on Twitter at https://twitter.com/AAbaterusso

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