7 ms·
Not to promote my employer (I'm a lame duck there anyway), but we just ran a related and useful article about valuing companies. It explains why market cap is.
by mrkurt 16y ago
Not to promote my employer (I'm a lame duck there anyway), but we just ran a related and useful article about valuing companies. It explains why market cap is... odd and gives some other metrics that may be more relevant: http://arstechnica.com/apple/guides/2011/02/does-this-metric-make-my-company-look-big.ars http://arstechnica.com/apple/guides/2011/02/does-this-metric...
- whatusername 16y agoThrowing in HP/IBM on the revenue and employee details would have been nice. Still - nice article.
- jakarta 16y agoNot to be offensive, but I don't think these other measures are very insightful. Measures like EV and assets dont really tell you much because they are easy to get skewed by leverage. The cash measure isn't great either because it's dominated by financials (where the cash does not necessarily belong to the bank). You see this as you go through the lists and notice different lists are dominated by certain types of companies. Market cap is actually a decent proxy here, just to see what the market 'perceives' the value of companies to be. If you were comparing large tech companies, a figure like FCF/EV might be interesting to see which company is yielding the most cashflow.