You would expect a lower PSR for a retail company than for a biotechnology company.

Question

Quizplus · Accepted Answer

A company's PSR (Price/Sales ratio) is typically lower for retail companies compared to biotechnology companies because retail companies have lower profit margins and sales growth rates compared to biotechnology companies. Retail companies typically have more stable earnings and revenue streams, but growth tends to be slower, resulting in a lower PSR. Biotechnology companies, on the other hand, tend to have higher growth rates and potential for future earnings, resulting in a higher PSR.

You Would Expect a Lower PSR for a Retail Company