price to sales ratio

APPLE INC. $201 (Nasdaq symbol AAPL; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 906.8 million; Market cap: $182.3 billion; Price-to-sales ratio: 3.8; No dividends paid; WSSF Rating: Average) will start selling its new iPad tablet computer in late March in the U.S. Apple could sell 6 million iPads in the first year. When you account for the cost of chips and other parts, that would generate roughly $2.6 billion in gross profits. To put this figure in context, Apple earned $3.4 billion, or $3.67 a share, in its first quarter, which ended December 26, 2009. The iPad will also spur demand for movies, music and books at Apple’s iTunes web store. Apple is a buy.

ABB LTD. ADRs $20 (New York symbol ABB; Conservative Growth Portfolio, Manufacturing & Industry sector; ADRs outstanding: 2.3 billion; Market cap: $46.0 billion; Price-to-sales ratio: 1.4; Dividend yield: 2.4%; WSSF Rating: Above Average) makes transformers, transmission switches and other equipment for distributing electricity. ABB is based in Switzerland. In 2009, ABB’s earnings fell 7.0%, to $2.9 billion, or $1.27 per ADR, from $3.1 billion, or $1.36 per ADR, in 2008. (Each American Depositary Receipt represents one ABB common share.) Revenue fell 8.9%, to $31.8 billion from $34.9 billion. Despite the lower revenue and earnings, demand for ABB’s power equipment is improving, particularly in developing countries. As well, the company is cutting jobs, closing plants and buying more raw materials from low-cost countries. By the end of 2010, these moves should lower ABB’s annual costs by $3 billion....

FAIR ISAAC CORP. $23 (New York symbol FICO; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 46.5 million; Market cap: $1.1 billion; Price-to-sales ratio: 1.7; Dividend yield: 0.4%; WSSF Rating: Average) sells products and services that help businesses around the world make better decisions on customer creditworthiness. Its main business is its FICO software, which lets creditors use a customer’s information to calculate a credit score. Fair Isaac’s main clients are banks and other lenders. The slow economy continues to hold back demand for new loans, so many of the company’s clients are spending less on its products and services. That’s why Fair Isaac’s revenue fell 7.3% in its first quarter, which ended December 31, 2009, to $151.5 million from $163.5 million a year earlier....

Department store operators Nordstrom, Macy’s and J.C. Penney have cut costs and slowed their expansion plans during the recession. Lower costs, plus their strong reputations and popular brands, should spur their earnings as the economy recovers. NORDSTROM INC. $37 (New York symbol JWN; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 217.5 million; Market cap: $8.0 billion; Price-to-sales ratio: 0.9; Dividend yield: 1.7%; WSSF Rating: Average) mainly sells upscale clothing, accessories and footwear. The company owns and operates 184 outlets, including 122 department stores, in 28 U.S. states. In the fiscal year ended January 30, 2010, Nordstrom earned $441.0 million, or $2.01 a share. That’s up 10.0% from $401.0 million, or $1.83 a share, in the prior year. The company is doing a good job of managing its inventory, which lowers the need for costly clearance sales. That was the main reason for the higher earnings. Overall revenue rose 0.6%, to $8.63 billion from $8.57 billion. However, the gain was entirely due to higher revenue at its credit-card division. Merchandise sales declined 0.2%. Same-store sales fell 4.2%....

J.C. PENNEY CO. INC. $28 (New York symbol JCP; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 236.0 million; Market cap: $6.6 billion; Price-to-sales ratio: 0.4; Dividend yield: 3.1%; WSSF Rating: Average) operates 1,108 department stores in the U.S. and Puerto Rico. In the fiscal year ended January 30, 2010, the retailer’s earnings fell 56.1%, to $249.0 million from $567.0 million in the prior year. Earnings per share fell 58.0%, to $1.08 from $2.57, on more shares outstanding. Due to falling investment values, Penney paid $337 million of pension costs in the the latest fiscal year. In the prior year, it reported $90 million of pension income. That was the main reason for the earnings drop. Excluding one-time items, per-share earnings fell 14.3%, to $1.86 from $2.17. Sales in fiscal 2010 fell 5.0%, to $17.6 billion from $18.5 billion. Same-store sales fell 6.3%. The company is doing a good job of paying down debt. Its long-term debt of $3.0 billion is down 14.4% from a year earlier, and is a manageable 45% of its market cap. Penney also holds cash of $3.0 billion, or $12.76 a share....

CAMPBELL SOUP CO. $33 (New York symbol CPB; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 342.9 million; Market cap: $11.3 billion; Price-to-sales ratio: 1.5; Dividend yield: 3.3%; WSSF Rating: Above Average) expects sales to rise by 2.5% to 3.5% in its current fiscal year, which ends July 31, 2010. That’s less than its earlier prediction of 4% to 5% growth. The weak economy is prompting more consumers to eat at home, and many are choosing cheaper, generic-brand canned soups. Campbell is responding by launching new soup promotions. It is also making its soups with fewer ingredients and less packaging. These moves should lift its fiscal 2010 earnings by around 10%, to $2.43 a share. The stock trades at 13.6 times that estimate. Campbell Soup is a buy....

APACHE CORP. $102 (New York symbol APA; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 336.4 million; Market cap: $34.3 billion; Price-to-sales ratio: 4.0; Dividend yield: 0.6%; WSSF Rating: Average) raised its daily production by 9.2% in 2009. Even so, its earnings fell 50.2%, to $5.59 a share from $11.22 in 2008. Cash flow per share fell 32.5%, to $14.76 from $21.88. The lower results were mainly caused by a 31.8% drop in oil prices and a 44.9% decline in natural-gas prices. Apache’s production should rise again this year. That’s because new wells will begin operating in Australia, Canada and Egypt. The company’s strong balance sheet also gives it the flexibility to buy other related firms. Its $5.0 billion of long-term debt is a low 15% of its market cap. It holds cash of $2.05 billion, or $6.09 a share. Apache is a buy.

IDEXX LABORATORIES INC. $53 (Nasdaq symbol IDXX; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 58.6 million; Market cap: $3.1 billion; Price-to-sales ratio: 3.0; No dividends paid; WSSF Rating: Average) makes equipment that veterinarians use to detect diseases in animals. It also makes systems that detect contaminants in water and milk. The company sells its products in over 100 countries. Idexx began operating in 1983, and dominates its niche market. Despite its long history of success, many investors have probably never heard of Idexx, and few brokers cover it. Revenue rose 61.7%, from $638.1 million in 2005 to $1.03 billion in 2009. Earnings rose 54.1%, from $79.3 million in 2005 to $122.2 million in 2009....

MANITOBA TELECOM SERVICES INC. $31 (Toronto symbol MBT; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 64.7 million; Market cap: $2.0 billion; Price-to-sales ratio: 1.7; Dividend yield: 8.4%; SI Rating: Average) is the main provider of telephone services in Manitoba. The company’s Allstream subsidiary sells integrated telephone, Internet and other communication services to businesses across Canada. The company gets 70% of its profit from its Manitoba telephone business. However, a new alliance with Rogers Communications Inc. (Toronto symbol RCI.B) should broaden its geographic reach. The two companies are building a new high-speed wireless network in Manitoba. This alliance will make Manitoba Telecom more competitive in Manitoba, and let the company use Rogers’ existing network to sell more wireless services to its business customers in other parts of Canada. In 2009, Manitoba Telecom earned $103.9 million, or $1.61 a share. That’s down 29.5% from $147.4 million, or $2.28 a share, in the prior year. If you disregard restructuring costs and other unusual items, earnings per share would have fallen 12.9%, to $2.64 from $3.03. Revenue fell 3.1%, to $1.8 billion from $1.9 billion....

BELL ALIANT REGIONAL COMMUNICATIONS INCOME FUND $25 (Toronto symbol BA.UN; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 228.4 million; Market cap: $5.7 billion; Price-to-sales ratio: 1.8; Dividend yield: 11.6%; SI Rating: Above Average) provides telephone services in Atlantic Canada, as well as rural parts of Ontario and Quebec. As part of the deal that created the trust in 2006, Bell Aliant transferred its wireless operations to BCE, which owns 45% of the trust. Bell Aliant earned $373.0 million in 2009. That’s up 10.8% from $336.6 million in 2008. Earnings per unit rose 11.5%, to $2.33 from $2.09, on more units outstanding....