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No, revenue. For example Google's P/E (the equivalent profit ratio) is currently 31.4, and that's not including the control premium.
by ryanatkn 12y ago
No, revenue. For example Google's P/E (the equivalent profit ratio) is currently 31.4, and that's not including the control premium.
- wise_young_man 12y agoComparing the cost multiple for a private company's acquisition to a P/E ratio of a public stock is way different and not really a fair comparison.
- ryanatkn 12y agoIt's far from precise but I'd maintain it's useful to illustrate that if Oculus is a success, Facebook made a great buy.
- mason55 12y agoGenerally the starting point for any tech acquisition is 3x - 5x revenue multiplier. Occulus is hardware so their margins are lower than software, pushing them closer to the 3x mark.