Bitcoin Depot Inc. (NASDAQ:BTM) Shares Fly 36% But Investors Aren't Buying For Growth

Simply Wall St · 2d ago

Bitcoin Depot Inc. (NASDAQ:BTM) shares have continued their recent momentum with a 36% gain in the last month alone. The annual gain comes to 233% following the latest surge, making investors sit up and take notice.

In spite of the firm bounce in price, Bitcoin Depot may still be sending bullish signals at the moment with its price-to-sales (or "P/S") ratio of 0.6x, since almost half of all companies in the Commercial Services industry in the United States have P/S ratios greater than 1.5x and even P/S higher than 5x are not unusual. Although, it's not wise to just take the P/S at face value as there may be an explanation why it's limited.

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See our latest analysis for Bitcoin Depot

ps-multiple-vs-industry
NasdaqCM:BTM Price to Sales Ratio vs Industry July 5th 2025

How Has Bitcoin Depot Performed Recently?

While the industry has experienced revenue growth lately, Bitcoin Depot's revenue has gone into reverse gear, which is not great. Perhaps the P/S remains low as investors think the prospects of strong revenue growth aren't on the horizon. If this is the case, then existing shareholders will probably struggle to get excited about the future direction of the share price.

If you'd like to see what analysts are forecasting going forward, you should check out our free report on Bitcoin Depot.

What Are Revenue Growth Metrics Telling Us About The Low P/S?

In order to justify its P/S ratio, Bitcoin Depot would need to produce sluggish growth that's trailing the industry.

In reviewing the last year of financials, we were disheartened to see the company's revenues fell to the tune of 9.7%. At least revenue has managed not to go completely backwards from three years ago in aggregate, thanks to the earlier period of growth. So it appears to us that the company has had a mixed result in terms of growing revenue over that time.

Turning to the outlook, the next year should generate growth of 5.3% as estimated by the four analysts watching the company. Meanwhile, the rest of the industry is forecast to expand by 7.7%, which is noticeably more attractive.

In light of this, it's understandable that Bitcoin Depot's P/S sits below the majority of other companies. It seems most investors are expecting to see limited future growth and are only willing to pay a reduced amount for the stock.

What Does Bitcoin Depot's P/S Mean For Investors?

Bitcoin Depot's stock price has surged recently, but its but its P/S still remains modest. We'd say the price-to-sales ratio's power isn't primarily as a valuation instrument but rather to gauge current investor sentiment and future expectations.

We've established that Bitcoin Depot maintains its low P/S on the weakness of its forecast growth being lower than the wider industry, as expected. At this stage investors feel the potential for an improvement in revenue isn't great enough to justify a higher P/S ratio. The company will need a change of fortune to justify the P/S rising higher in the future.

And what about other risks? Every company has them, and we've spotted 2 warning signs for Bitcoin Depot you should know about.

It's important to make sure you look for a great company, not just the first idea you come across. So if growing profitability aligns with your idea of a great company, take a peek at this free list of interesting companies with strong recent earnings growth (and a low P/E).