Account Info
Log Out
No matches yet
Operations too frequent. Please try again later.
Please check network settings and try again Refresh Refresh
History record delete
    Quotes All >
      News All >
        Log in to access Online Inquiry

        FAQs about Practical Trading

        Views 11732022.09.21

        Is an unprofitable company worth investing in? How to value it?


        In this article, we will introduce:

        Is your company profitable?

        Is an unprofitable company worth investing in?

        Then how to value it?

        Investors have been overjoyed with earning results for many years. However, Amazon famously lost money for its first 17 straight quarters as a public company. Now, Amazon records a $6.3 billion quarterly profit, and the market value soars rapidly.


        It's true that an unprofitable company will record huge profits one day.

        Is your company profitable?

        There are a lot of companies resulting in a loss for many years in the market. We can figure out whether it earns or loses money on the stock page.


        Moomoo Stock Page

        If the P/E(TTM) shows "Loss", it means the company loses money in the latest trailing 12 months.

        Is an unprofitable company worth investing in?

        The answer is it depends. We take $Roku Inc(ROKU.US)$ for example. 

        logo"Financial" tab on Moomoo stock page

        According to the financial data of ROKU, the revenue has been always higher than the predicted value in recent quarters, which means the company grows up rapidly as net income is not the most important indicator the Street cares about at this stage. Growth matters.

        Then how to value it?

        We should use the Price-to-Sales (P/S)  to value an unprofitable company.

        We can figure out the P/S ratio in the "Analysis" tab. A P/S ratio higher than the past or rivals' represents the stock may be overvalued.


        "Analysis" tab on Moomoo stock page

        Price-To-Book (P/B) ratio is another valuation indicator. We have talked about it in the previous article.

        Trade like a pro with moomoo

        Get free stock and start your professional trading today

        Terms and conditions apply right-arrow

        This presentation is for informational and educational use only and is not a recommendation or endorsement of any particular investment or investment strategy. Investment information provided in this content is general in nature, strictly for illustrative purposes, and may not be appropriate for all investors. It is provided without respect to individual investors’ financial sophistication, financial situation, investment objectives, investing time horizon, or risk tolerance. You should consider the appropriateness of this information having regard to your relevant personal circumstances before making any investment decisions. Past investment performance does not indicate or guarantee future success. Returns will vary, and all investments carry risks, including loss of principal. Moomoo makes no representation or warranty as to its adequacy, completeness, accuracy or timeliness for any particular purpose of the above content.

        Moomoo is a financial information and trading app offered by Moomoo Technologies Inc.

        In the U.S., investment products and services available through the moomoo app are offered by Moomoo Financial Inc., a broker-dealer registered with the U.S. Securities and Exchange Commission (SEC) and a member of Financial Industry Regulatory Authority (FINRA)/Securities Investor Protection Corporation (SIPC).

        In Singapore, investment products and services available through the moomoo app are offered through Moomoo Financial Singapore Pte. Ltd. regulated by the Monetary Authority of Singapore (MAS). Moomoo Financial Singapore Pte. Ltd. is a Capital Markets Services Licence (License No. CMS101000) holder with the Exempt Financial Adviser Status. This advertisement has not been reviewed by the Monetary Authority of Singapore.

        In Australia, financial products and services available through the moomoo app are provided by Futu Securities (Australia) Ltd, an Australian Financial Services Licensee (AFSL No. 224663) regulated by the Australian Securities and Investment Commission (ASIC). Please read and understand our Financial Services Guide, Terms and Conditions, Privacy Policy and other disclosure documents which are available on our websites and Moomoo Technologies Inc., Moomoo Financial Inc., Moomoo Financial Singapore Pte. Ltd. and Futu Securities (Australia) Ltd are affiliated companies.