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Alberto Abaterusso
Alberto Abaterusso
Articles (2474) 

A Trio of Stocks With Low Price-Sales Ratios to Consider

These companies operate profitable businesses and have robust financial conditions

September 14, 2020 | About:

Investors who are seeking value opportunities may be interested in the following stocks, as they have low price-sales ratios, high profitability and robust financials.

Buckle Inc

The first company investors should consider is Buckle Inc (NYSE:BKE), a Kearney, Nebraska-based casual apparel retailer for young men and women in the U.S.

The stock traded at $20.76 per share at close on Sept. 11 for a price-sales ratio of 1.23, which is higher than the industry median of 0.62 still appeals more than the S&P 500 index's 2.37%.

Buckle Inc has a GuruFocus profitability rating of 7 out of 10, driven by a return on equity (ROE) ratio of 23.94%, which is more than three times the industry median of 2.95%, and by an operating margin of 14.82%, which is more than six times the industry median of 2.18%.

The company has received a positive GuruFocus financial strength rating of 5 out of 10 with a cash-to-debt of 0.84 compared to the industry median of 0.5 and a return on invested capital (ROIC) of 16.1%, which is higher than the weighted average cost of capital (WACC) of 7.5%.

As a result of an 1.5% increase over the past year, the stock has a market capitalization of $1.03 billion and a 52-week range of $11.76 to $28.52.

Wall Street sell-side analysts recommend a hold rating with an average target price of $14 per share of Buckle Inc.

Usana Health Sciences Inc

The second company investors may want to consider is Usana Health Sciences Inc (NYSE:USNA), a Salt Lake City, Utah-based manufacturer and seller of nutritional and personal care products.

The stock traded at around $77.36 per share at close on Sept. 11 for a price-sales ratio of 1.58, which is more convenient than the S&P 500's 2.37% but above the industry median of 0.95.

Usana Health Sciences Inc has a GuruFocus profitability rating of 9 out of 10 with a return on capital of 153.2%, which is 17 times the industry median of 9%, a ROE of 32%, which is six times the industry median of 5.5%, and by a return on assets (ROA) ratio of 22%, which is nine times the industry median of 2.5.

The company has received a very high GuruFocus financial strength rating of 9 out of 10, driven by the absence of debt and by a ROIC which, at 35.7%, is higher than the WACC of 7.3%.

Following a 7.4% increase over the past year through Friday, the stock has now a market capitalization of $1.63 billion and a 52-week range of $43.01 to $92.26.

Wall Street sell-side analysts recommend an overweight rating with an average target price of $97.50 per share of Usana Health Sciences Inc.

National Presto Industries Inc

The third stock that should be under investors' consideration is National Presto Industries Inc (NYSE:NPK), an Eau Claire, Wisconsin-based provider of household items primarily in North America.

The stock traded at $81.60 per share at close on Sept. 11 for a price-sales ratio of 1.76, which is higher than the industry median of 1.17 but still much more compelling than the S&P 500 index's 2.37%.

National Presto has a very good GuruFocus profitability rating of 7 out of 10, driven by a net profit margin rate of 15%, a ROA ratio of 12.3% and return on capital of 32.11%.

The company has a GuruFocus financial strength rating of 8 out of 10, driven by a cash-to-debt ratio of 37.72 (versus the industry median of 0.56), a debt-equity ratio of 0.01 (versus the industry median of 0.4) and ROIC of 20.8%, which is four times the WACC of 5%.

As a result of a 14.6% decline in the share price over the past year, the market capitalization now stands at $572.95 million and the 52-week range is $66.60 to $97.90.

Wall Street sell-side analysts recommend a buy rating with an average target price of $128 per share of National Presto Industries Inc.

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 how to pick potential value stocks. Gold, silver and precious metals mining industries is also my cup of tea. 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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