Earning multiples choose an arbitrary time length of 1 year. What you're really trying to purchase is a machine that creates more money than it uses. You need

Earning multiples choose an arbitrary time length of 1 year. What you're really trying to purchase is a machine that creates more money than it uses. You need to guess at if that machine will do its job at an arbitrary point in the future, and how well it will do it. Those factors are only loosely correlated with current PE