Galaxy Digital (GLXY) is back in focus after Bank Leumi in Israel selected the company to power a new digital asset trading service, using GalaxyOne Institutional and Galaxy's Custody Infrastructure platform.

Recent news around Bank Leumi and the earlier collaboration with BNY Mellon comes after a mixed year for Galaxy Digital, with short term share price momentum picking up, while the 1-year total shareholder return remains weak compared with the very large 3-year total shareholder return.

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Recent deals with Bank Leumi and BNY Mellon suggest Galaxy Digital is securing a place in institutional crypto infrastructure. After the sharp share price swings and mixed earnings, investors may question whether this business strength is already reflected in the current price.

Preferred Price-to-Sales Multiple for Galaxy Digital: Is it justified?

On a simple sales based view, Galaxy Digital looks cheap relative to both peers and the broader US Capital Markets industry, even after a volatile year for the share price.

The preferred metric here is the price-to-sales ratio, or P/S. This compares the company’s market value to the revenue it generates. This can be useful for businesses like Galaxy Digital that are currently unprofitable but still producing material revenue from digital assets and infrastructure services.

Galaxy Digital is described as trading at good value based on its P/S ratio of 0.1x compared with peers on 4x. The stock is also assessed as good value versus the wider US Capital Markets industry, where the average P/S is 3.5x. In addition, an estimated fair P/S ratio of 3.1x suggests the current market level is far below the level the regression based model indicates the stock could move towards if sentiment and fundamentals align.

Result: Price-to-sales of 0.1x (UNDERVALUED)

However, investors still face key risks. Galaxy Digital remains unprofitable with a reported net loss, and its recent one-year returns are weak despite a very large three-year gain.

Next Steps

With mixed signals around Galaxy Digital, it makes sense to move fast and check the full picture for yourself rather than rely on headlines alone. To see both sides of the story, including the 1 key reward and 4 important warning signs flagged by our model, start with the 1 key reward and 4 important warning signs.

Looking for more investment ideas beyond Galaxy Digital?

If you stop at Galaxy Digital, you could miss other opportunities that fit your style. Take a few minutes now to scan the wider market with focused ideas.

• Target potential mispricing and let the numbers guide you by reviewing the 52 high quality undervalued stocks.
• Secure potential income ideas by assessing companies in the 10 dividend fortresses.
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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.