With our models, there's no need to rely
on traditional valuation metrics like price - to - earnings and price - to - sale ratios when investors can get the information our models provide in the same or less time that it takes to calculate the traditional metrics.
Our approach attempts to mitigate risk by focusing on
traditional valuation metrics such as price / earnings (P / E), price / sales (P / S) and buying small, overlooked companies at a discount to our estimates of their intrinsic value.
A current example is the use of metrics like «price per eyeball» to justify the valuations of internet focused companies and divert attention from the fact that on
traditional valuation metric these companies can look very expensive.
Maybe using
the traditional valuation metrics are not a bad idea.
This also means that many of
the traditional valuation metrics available for publicly - traded companies are harder to tease out for BX due to its different accounting methodologies.