Another way of saying "earnings," more or less.
In this context, the term is focusing on profitability and/or profit margins…i.e. the ability to turn a dollar of revenue into however many cents after everything, including taxes.
Return on sales divides a company's level of profit by its total sales figure. The result is a percent. The higher the percent, the higher level of profitability the company is producing.
The calculation is simply after-tax income and sales in the denominator.
Related or Semi-related Video
Finance: What is Return on Sales (ROS)?3 Views
Finance allah shmoop what is return on sales or r
o s This is your return This is your return
on sale Any questions Oh i see a lot of
hands raised Ok then return on sales are roos is
an investment metric which basically reflects how profitable a company
is that is return here is profits and sales is
well the stuff you sold so return on sales is
a profitability index It speaks to how profitable and given
industry or company runs take wear hauser the paper and
pulp company that kills trees and makes them into paper
in a good year They have five billion dollars in
sales and profits of two hundred fifty million Really low
profit margin business especially when you consider that so many
years are well not good But the google search biz
well it's a bunch of servers and algorithm and not
much else So in a given year on sales of
twenty billion box it'll have returns of something like fifteen
billion pretax The basic notion is that you will see
the term return on a ton of other terms like
return on capital return on assets return on equity and
almost always the return that they're referring to There is
profits or earnings And from that ratio of return on
whatever in this case return on sales Investors can impute
a profit margin just a fraction which then derives the
valuation and or various other metrics Important toe Understanding a 00:01:33.812 --> [endTime] given security investment that's Why we study it
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