3 ms·
It's a good question. The consensus is that P/E is not a good valuation metric for high growth companies. I would rather use comparable multiples, DCF or sum
by 0bsidian 9y ago
It's a good question.
The consensus is that P/E is not a good valuation metric for high growth companies.
I would rather use comparable multiples, DCF or sum of the parts for this type of exercise.
The principle being that you will benefit from stock appreciation rather than dividend payout.
e.g.:
https://www.investors.com/how-to-invest/investors-corner/ignore-pe-ratios-in-stock-investing/ https://www.investors.com/how-to-invest/investors-corner/ign...
https://seekingalpha.com/article/4035706-p-e-ratio-good-metric-use-growth-stocks https://seekingalpha.com/article/4035706-p-e-ratio-good-metr...