Lesson 3: P/S — When Earnings Don't Exist Yet. Revenue is the easiest line to grow. P/S works when P/E breaks — but it can flatter low-margin businesses.
No profit yet — now what?
Think about what still exists to measure.
Assessment
A young software company is growing fast with real, paying customers — but it reinvests everything and reports no profit yet, so a price-to-earnings ratio can't even be calculated. What could you measure instead to size it up?
What's still on the page? 🤔