Yes, and as long as enough investors believe in that thesis, it'll stay where its at.
What's Uber's stock price and valuation after burning $30 billion dollars and still not turning a profit? (Uber picked in particular because I'm familiar with their financials)
Since you’re familiar with Uber’s financials, I have a question. Do you think they’ll be able to survive as a company once interest rates begin rising?
Not a financial advisor, not financial advice, this is merely a thought experiment.
Uber will survive as long as there are investors willing to believe they might be profitable, eventually. Once the consensus or shared belief turns, I believe they’ll face significant challenges raising capital in the market.
Yes, but if their profits stayed consistent at current rates the stock price would be quite high compared to other companies. It's price-to-earnings ratio is 408, meaning it would take 408 years for it to buy all its outstanding stock just from earnings. By contrast Ford's is 16 and Alphabet's (Google's) is 29.
The 408 ratio is justified by the assumption that earnings will be a lot higher in coming decades.
