SKYX Platforms Corp.'s (NASDAQ:SKYX) Shares Leap 44% Yet They're Still Not Telling The Full Story

The SKYX Platforms Corp. (NASDAQ:SKYX) share price has done very well over the last month, posting an excellent gain of 44%. Looking back a bit further, it's encouraging to see the stock is up 26% in the last year.

Although its price has surged higher, it's still not a stretch to say that SKYX Platforms' price-to-sales (or "P/S") ratio of 2x right now seems quite "middle-of-the-road" compared to the Electrical industry in the United States, where the median P/S ratio is around 2.4x. Although, it's not wise to simply ignore the P/S without explanation as investors may be disregarding a distinct opportunity or a costly mistake.

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See our latest analysis for SKYX Platforms

What Does SKYX Platforms' P/S Mean For Shareholders?

Recent times haven't been great for SKYX Platforms as its revenue has been rising slower than most other companies. It might be that many expect the uninspiring revenue performance to strengthen positively, which has kept the P/S ratio from falling. You'd really hope so, otherwise you're paying a relatively elevated price for a company with this sort of growth profile.

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How Is SKYX Platforms' Revenue Growth Trending?

In order to justify its P/S ratio, SKYX Platforms would need to produce growth that's similar to the industry.

Retrospectively, the last year delivered a decent 5.7% gain to the company's revenues. Although, the latest three year period in total hasn't been as good as it didn't manage to provide any growth at all. Accordingly, shareholders probably wouldn't have been overly satisfied with the unstable medium-term growth rates.

Looking ahead now, revenue is anticipated to climb by 23% per year during the coming three years according to the six analysts following the company. With the industry only predicted to deliver 19% per year, the company is positioned for a stronger revenue result.

In light of this, it's curious that SKYX Platforms' P/S sits in line with the majority of other companies. It may be that most investors aren't convinced the company can achieve future growth expectations.

What We Can Learn From SKYX Platforms' P/S?

SKYX Platforms appears to be back in favour with a solid price jump bringing its P/S back in line with other companies in the industry Typically, we'd caution against reading too much into price-to-sales ratios when settling on investment decisions, though it can reveal plenty about what other market participants think about the company.

We've established that SKYX Platforms currently trades on a lower than expected P/S since its forecasted revenue growth is higher than the wider industry. When we see a strong revenue outlook, with growth outpacing the industry, we can only assume potential uncertainty around these figures are what might be placing slight pressure on the P/S ratio. At least the risk of a price drop looks to be subdued, but investors seem to think future revenue could see some volatility.

We don't want to rain on the parade too much, but we did also find 1 warning sign for SKYX Platforms that you need to be mindful of.

If companies with solid past earnings growth is up your alley, you may wish to see this free collection of other companies with strong earnings growth and low P/E ratios.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.