Re:Why Amazon Has No Profits and Why It Works
by tsyd on Saturday September 06, 2014 @09:41AM
(#8278332)
Remember: it's the price-to-earnings ratio and not price-to-revenue ratio.
Amazon's stock trades at a P/E of 910 exactly because it's deferring profit to continue growing its revenue. At some point it's going to stop investing its revenue into growth and start realizing a profit on that revenue. At that point the P/E will come down.
Amazon's stock trades at a P/E of 910 exactly because it's deferring profit to continue growing its revenue. At some point it's going to stop investing its revenue into growth and start realizing a profit on that revenue. At that point the P/E will come down.