单选题 Which of the following is a disadvantage of using price-to-sales (P/S) multiples in stock valuations?

A、 P/S multiples are more volatile than P/E multiples.
B、 The use of P/S multiples can miss problems associated with cost control.
C、 P/S multiples are not available for all firms, unlike the P/E ratio.

【正确答案】 B

【答案解析】Due to the stability of using sales relative to earnings in the price-to-sales (P/S) multiple, an analyst may miss problems of troubled firms concerning its cost control. P/S multiples are actually less volatile than P/E ratios, which is an advantage in using the PS multiple. Another advantage is that P/S ratios are available for all firms, including distressed firms, which is not necessarily the case for P/E multiples.