4 ms·
There will always be some leading parameters some lagging parameters. It makes a difference when you are overly leveraged or if you are too small but big compan
by kshacker 4y ago
There will always be some leading parameters some lagging parameters. It makes a difference when you are overly leveraged or if you are too small but big companies like google, Amazon, apple should be able to manage some level of forecast leading or lagging the demand, no?
- adam_arthur 4y agoSure, it’s important not to overindex on short term fluctuations. But their employment expense and headcount growth is far, far ahead of their revenue growth. A recession next year is pretty much inevitable at this point due to inflation dynamics and Fed policy. Having their stock get hammered even worse as revenues contract and margin compression eats into earnings is going to lead to many more problems for them in the future than if they just slow the pace of hiring now. They may even be doing layoffs this time next year, which is much easier to avoid if you don’t overhire leading into a recession
- ikrenji 4y agogoogles net profit is still a whopping 14 billy dollars. their search monopoly isn't going anywhere anytime soon either. i don't think googlers have anything to worry about
- adam_arthur 4y agoAbsolute net profit means nothing without relating it to valuation. $14B is not that significant for a trillion dollar company. It's all relative. Google may be fair value or may not, but ignoring proper approaches to valuation is a good way to lose your money... as many younger investors are starting to learn.