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Chicago, IL – September 12, 2025 – Stocks in this week’s article are Oshkosh Corp. OSK, EPAM Systems, Inc. EPAM, Green Dot GDOT, The Mosaic Co. MOS and PagSeguro Digital PAGS.
Investing in stocks based on valuation metrics is a proven strategy for identifying opportunities with strong upside potential. While the price-to-earnings (P/E) ratio is a popular tool for gauging value, it has its limitations, especially when evaluating companies that are unprofitable or still in their early growth phases.
In such cases, the price-to-sales (P/S) ratio becomes particularly valuable. By comparing a company’s market capitalization to its revenues, the P/S ratio offers a clearer picture of value when earnings are minimal or volatile.
If you are looking for growth at a discount, low P/S stocks can offer compelling opportunities. These stocks often trade below their intrinsic value, making them attractive to investors seeking upside potential without paying a premium. While the P/S ratio alone does not guarantee success, when combined with strong fundamentals and positive business momentum, it can signal a stock poised for a breakout.
Oshkosh Corp., EPAM Systems, Inc., Green Dot, The Mosaic Co. and PagSeguro Digital are some companies with low price-to-sales ratios and the potential to offer higher returns.
While a loss-making company with a negative price-to-earnings ratio falls out of investor favor, its price-to-sales can indicate the hidden strength of the business. This underrated ratio is also used to identify a recovery situation or ensure a company's growth is not overvalued.
A stock’s price-to-sales ratio reflects how much investors pay for each dollar of revenue generated by a company.
If the price-to-sales ratio is 1, investors are paying $1 for every $1 of revenues generated by the company. A stock with a price-to-sales ratio below 1 is a good bargain, as investors need to pay less than a dollar for a dollar’s worth.
Thus, a stock with a lower price-to-sales ratio is a more suitable investment than a stock with a high price-to-sales ratio.
The price-to-sales ratio is often preferred over price-to-earnings, as companies can manipulate their earnings using various accounting measures. However, sales are harder to manipulate and are relatively reliable.
However, one should keep in mind that a company with high debt and a low price-to-sales ratio is not an ideal choice. The high debt level will have to be paid off at some point, leading to further share issuance, a rise in market cap and a higher price-to-sales ratio.
In any case, the price-to-sales ratio used in isolation cannot do the trick. One should analyze other ratios like Price/Earnings, Price/Book and Debt/Equity before arriving at any investment decision.
Here are five of the 28 stocks that qualified the screening:
Oshkosh is engaged in designing, developing and manufacturing custom-built vehicles and equipment. Its top brands offer a variety of specialized vehicles and equipment designed for diverse end markets. The company has expanded its capabilities through strategic acquisitions, including AUSA to grow its presence in agriculture, JBT’s AeroTech to enhance air transport offerings and boost recurring revenues, and Hinowa to advance electrification and strengthen its European footprint.
Oshkosh continues to make strides in electrification with the launch of the Volterra ZFL eRCV, the industry’s first fully integrated electric refuse vehicle, complementing its Volterra ZFL side loader. These innovations, alongside advancements like AI-driven waste contamination detection and an autonomous, all-electric refuse collection arm, position Oshkosh at the forefront of safety and productivity in the market. OSK has a Value Score of B and sports a Zacks Rank #1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
EPAM Systems is well known for its software engineering and IT consulting services. The company is engaged in providing software product development services, custom application development services, application testing services, application maintenance and support services, infrastructure management services and enterprise information management services. The company is gaining from the ongoing digital transformation by enterprises and a continued focus on customer engagement and product development.
EPAM’s sustained focus on strategic acquisitions and partnerships enhances its product portfolio and drives top-line growth. Its substantial investment in Gen AI capabilities is expected to boost growth as AI becomes increasingly integral to enterprise operations. A sustained focus on realigning the cost structure with the current demand environment is likely to benefit margins. EPAM currently has a Value Score of B and a Zacks Rank #2.
Green Dot is a pro-consumer bank holding company and personal banking provider. It offers products and services directly to customers through a large-scale omni-channel national distribution platform. Green Dot is a leader in prepaid cards and Banking-as-a-Service (BaaS), partnering with major companies like Walmart, Uber and Apple. Its asset-light model ensures high interchange fees and reduced reliance on interest income, keeping the balance sheet strong.
With low debt and significant cash reserves, Green Dot is well-positioned for growth initiatives. It is expanding its addressable market with the help of its BaaS account programs. Green Dot’s long-standing relationship with Walmart is a key driver of its operating revenues. GDOT currently flaunts a Zacks Rank #1 and has a Value Score of A.
Mosaic is a leading producer and marketer of concentrated phosphate and potash for the global agriculture industry. It was formed through the combination of the fertilizer businesses of agribusiness giant Cargill Incorporated and IMC Global Inc. Mosaic is the biggest integrated phosphate producer globally and is among the four largest potash producers in the world. The company is witnessing strong demand in its key markets. Farmer economics remain attractive in most global growing regions on strong crop demand, affordable inputs and favorable weather.
Mosaic continues to benefit from its extensive cost transformation work. The company is taking actions to cut costs amid a still challenging operating environment through its cost-cutting program, leading to an improvement in its operating cost structure. It is making progress in controlling its per-ton selling, general and administrative (SG&A) expenses. The company remains committed to carrying out investments with high returns and moderate capital expenditure. MOS currently has a Value Score of A and a Zacks Rank #2.
São Paulo, Brazil-based PagSeguro Digital offers a broad suite of financial and payment solutions tailored for consumers, individual entrepreneurs, micro-merchants, and small to mid-sized businesses across Brazil and select international markets. Its offerings include digital banking, wire transfers, tax payments, ATM access, and POS and online payment tools. With a tech-driven, integrated ecosystem, PagSeguro delivers accessible services that support daily operations and drive business growth.
PAGS is strengthening its digital banking platform, expanding services for consumers and merchants, while adjusting credit offerings to manage funding cost pressures. Its shift toward secured lending reflects a disciplined, risk-aware strategy. With a focus on innovation, sustainable growth and prudent financial management, PagSeguro is well-positioned to seize long-term opportunities in Brazil’s dynamic digital finance space. PAGS currently has a Value Score of A and a Zacks Rank #2.
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For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/2750155/5-price-to-sales-stocks-positioned-to-benefit-from-market-shifts
Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.
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