Meta Platforms Inc. (NASDAQ:META)

The price-to-sales ratio exhibited considerable fluctuation between 2013 and 2026. Initially, the ratio demonstrated an increasing trend, followed by a period of decline and subsequent volatility. A general observation is that the ratio’s movements do not consistently correlate with changes in share price or sales per share.

Initial Growth & Subsequent Decline (2013-2016)

From February 2013 to January 2016, the price-to-sales ratio increased from 13.92 to 17.32. This suggests that the market was willing to pay a progressively higher price for each dollar of sales. However, this upward momentum stalled, and the ratio experienced a moderate decline to 13.70 by February 2017.

Significant Reduction & Low Point (2017-2022)

A more pronounced downward trend was observed between February 2017 and February 2022. The ratio decreased substantially, falling from 13.70 to a low of 4.20. This period indicates a significant shift in market valuation, with investors assigning a considerably lower premium to each dollar of sales. The lowest value occurred in February 2022.

Recent Volatility & Increase (2022-2026)

Beginning in February 2022, the price-to-sales ratio began to increase, reaching 8.98 in February 2024, and 9.29 in January 2026. This represents a recovery from the previous lows, but remains below the levels seen earlier in the observed period. The increase suggests a renewed, though moderate, investor confidence. The ratio peaked at 10.58 in February 2024 before slightly decreasing.

Correlation with Share Price & Sales per Share

While share price and sales per share generally increased over the period, the price-to-sales ratio did not consistently follow suit. For example, sales per share increased steadily from 2017 to 2026, but the price-to-sales ratio experienced a significant decline during the same timeframe. This suggests that factors beyond revenue growth, such as investor sentiment or broader market conditions, played a substantial role in determining the ratio’s valuation.

In summary, the price-to-sales ratio demonstrates a complex pattern of fluctuations. The initial growth phase was followed by a substantial decline and a more recent period of recovery and volatility. The ratio’s movements are not solely dictated by changes in share price or sales per share, indicating the influence of external factors on market valuation.