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Finance Dictionary and Glossary of Investment Terms
Sales/Share
Definition 1.
The latest twelve months'' sales divided by the latest shares outstanding. Net income is subject to various circumstances and accounting decisions, but sales are (generally) sales. Investment theorists have in recent years paid more attention to sales as an indicator of a company''s prospects. James O''Shaughnessy, for instance, looks at the ratio of share price to sales per share; if this number is below 1.5, he consider it an indicator that the stock is undervalued. (O''Shaughnessy is the author of ""What Works on Wall Street"" and manages mutual funds based on his ideas.)
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