[FoRK] RPE and understanding company performance
jbone at place.org
Fri Jun 18 05:17:16 PDT 2010
Small correction: I said RPE (revenue per) rather than EPE in the
subject; ytpo, but both are interesting, particularly together. The
difference between the two is also interesting.
Given either R and RPE or earnings and EPE you can back into the
number of employees, and you can then get the per employee
contribution to market cap. This can be used at any point in time to
evaluate different companies within a given sector relative to each
other, or various averages across whole sectors to compare sectors.
The latter makes it easy to spot anomalies: individual companies
within a sector or whole sectors that may be "overheated" etc.
E.g. as I recall, back in '99 or so eToys.com shortly after its IPO
stood out like a sore thumb for some time on this metric...
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