Is the Sage share price expensive at 720p?

Sage (LON:SGE) is a large cap stock in the Software industry. The company provides solutions that help businesses of all shapes and sizes to manage accounting and finances payments, people and payroll.

Right now the Sage share price is on the expensive side from a factor perspective, based on its Value Rank of 26. Let's see why this is.

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A closer look at Sage's Value Rank

We can see by using Sage’s StockReport that the group has a:

• Rolling price to book value of 5.67,

• Trailing twelve month price to earnings ratio of 23.5

• Trailing twelve month price to free cashflow of 17.9

• Rolling dividend yield of 2.36%

• Trailing twelve-month price to sales ratio of 4.12

This combination of financial traits suggests that Sage stock is toward the more expensive end of the market. Being expensive is not the end of the world, of course - but it does help to have favourable exposures to other factors to justify the share price premium.

Studies indicate that combining factors such as Value, Quality and Momentum is a more effective way of outperforming the market over longer time frames. That's why we have constructed our StockReports to give an instant impression of how well exposed Sage (LON:SGE) is to these three factors. We go into greater detail on factor investing in this video.

Stockopedia helps you to identify return-enhancing factors such as Quality, Value and Momentum by analysing thousands of data points every day. To find out more about you find investment opportunities and analyse your portfolios then take one of our two-week free trials and have a look around.