4 ms·

So you assume comparable P/E to other much larger and more established companies, in order to arrive at a fanciful market cap number, in order to prove...someth

• nl 17y ago
  Not at all. Bigger, more established companies generally have (much) lower P/E ratios that new companies (eg, Google had a P/E ratio of 118 at their float price, and had a lot of criticism for pricing too low. See http://www.businessweek.com/technology/content/aug2007/tc20070816_425764_page_2.htm http://www.businessweek.com/technology/content/aug2007/tc200...). I'd be very interested in what you think a non-fanciful market cap number is - and how you arrive at it! My point is that when they float, they will raise a lot of money. It might be $5 billion, it might be $20 billion, it might be $50 billion. In any case, they are going to be sitting on a big reserve of cash. Your point was that they will be irrelevant in 5 years. My argument is that - ignoring other factors - any company in the tech sector sitting on a few billion dollars in cash is far from irrelevant.
  • sunchild 17y ago
    "I'd be very interested in what you think a non-fanciful market cap number is - and how you arrive at it!" Market cap is defined as "a measurement of size of a business enterprise (corporation) equal to the share price times the number of shares outstanding of a public company". My point all along is that you are engaging in wild, unfounded speculation about a non-public company, using wholly inappropriate metrics.