4 ms·
P/E is a useless metric for high-growth industries.
by paulbaumgart 13y ago
P/E is a useless metric for high-growth industries.
- adventured 13y agoI wasn't aware that all the companies in the Russell 2000 were high growth. I was under the impression they're small caps, which has nothing to do with growth rate. A doubling of the PE over the course of one year is not a useless metric in fact. It means you're paying twice an already extreme price for the growth you get, compared to last year.
- paulbaumgart 13y agoCompanies that have a strong vision for how to turn their cash into growth should not have profits.