Course 410: Distressed Stocks
How Cheap Is It?
In this course
1 Introduction
2 What Went Wrong?
3 How Bad Is It?
4 Is the Stock Despised?
5 How Cheap Is It?
6 Conclusion: Putting It All Together

SGI's valuations have been crunched, too. It had no price/earnings ratio at the end of 1999 because it had lost money over the previous four quarters, but based on stabler measures, such as price/book and price/sales ratios, SGI trades in the bargain basement. As of the end of 1999, its price/book ratio was about 1.5 and its price/sales ratio was 0.7, both about half what they were in 1995 and less than one fifth the S&P 500 average.

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