So you're agreeing with me. I'm arguing it has minimal correlation. If high P/E = future profits, the model is useful. Low P/E (if they are making a healthy profit) = the model is useful.
It's the edge case of low P/E and low profits that indicates a non-valuable biz model.
Comments
So you're agreeing with me. I'm arguing it has minimal correlation. If high P/E = future profits, the model is useful. Low P/E (if they are making a healthy profit) = the model is useful.
It's the edge case of low P/E and low profits that indicates a non-valuable biz model.