It was insane to me that a company that had less than thirty-billion in revenue was valued at more than a trillion. I'm not sure how the People in Charge didn't call bullshit.
The way exponential maths works, if a company really can grow at (for example) 10% per annum then it can grow into what looks initially like a very high PE multiple on current earnings surprisingly quickly.
This is why people sometimes use forward P/E but that does have the obvious drawback of the denominator not actually existing yet.
However with SpaceX the valuation is extreme and also can they grow at that rate for years on end? Potentially not
This is why people sometimes use forward P/E but that does have the obvious drawback of the denominator not actually existing yet.
However with SpaceX the valuation is extreme and also can they grow at that rate for years on end? Potentially not