If the company's profit margin is constant over time, the number of common shares remains the same, and the dividend payout ratio stays the same, the price to sales ratio, the price to earnings ratio and the price to book value ratio should:

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If the profit margin, number of common shares, and dividend payout ratio remain constant, then the company's earnings and book value per share should also remain constant over time. This means that the price to earnings ratio and price to book value ratio should also remain relatively constant. Additionally, since the company's revenue (sales) is also assumed to be constant, the price to sales ratio should also provide a similar valuation. Therefore, all three ratios should provide similar valuations for the company's stock value.

If the Company's Profit Margin Is Constant Over Time, the Number