"P/E is SO overrated by novice investors! "
Sounds familiar, circa 1999. who wants profits and dividends when you can have a theoretical implied growth to the moon. As long as people eat 2 dinners an evening, OPEN is valued fairly
I am factoring that in. You factor it in as competition. I factor it in as an acquisition multiple. Let me see, either 1) Google or Facebook (or Yahoo, or...) starts their own service, and one of the many others has to buy OPEN to catch up, or 2) One of them jumps in buying OPEN at the start. Either way, OPEN shareholders win big. P/E is SO overrated by novice investors!
If they can't answer the phone, that is probably bad for Open Table as a customer, they probably can't pay the bills, either.
As a point of reference, Bristol-Myers Squibb also had a market cap of $1.6 billion in 1981, after decades of profitability, 81 years after their first profit, 60 years after making their first $1 million year. OPEN has had 1.5 straight years of profit, busted $1 million for the first time 2.5 years ago. Of course, Bristol-Myers didn't have coupons, customers that couldn't answer the phones and a rewards system that no one understands. I guess they slogged away far too long without these 3 easy trick to becoming a billion dollar company.
"You wrote that don't personally make reservations at "starred" restaurants"
I said "except" at, my point is that there aren't that many, and since OPEN is not customer fiendly, they aren't getting much additional business when they need it, only when they're already booked. I think you are completely underestimating what google or Facebook could do fairly quickly to OPEN.
Nobody is discussing the Open Table reservation by phone service that they have recently announced. A major driver of Open Table usage is the inability of most restaurants to professionally answer the phone (at 9:30AM or any other time) unless they happen to be large enough to employ a reservationist. Open Table is perfectly positioned to offer this value added service to capture a portion of the 92% of reservations NOT being taken with their online solution.
Corporate admins greatly value the convenience of either web enabled reservations OR easy phone reservations, both of which Open Table is now addressing. Forward revenue estimates MUST consider this new revenue opportunity that Open Table is on the verge of offering through its Table Maestro acquisition.
Restaurants operators will be very comfortable handing off answering the phone during the day to be certain that their reservation line is being handled in a way to minimize lost reservations.
'Happens all the time in real world business, sonny. Proprietary solution or not, if the right solution to a critical customer problem comes along at the right time, buyers will flock, because it will make them more money or save them more money. The longer that Open Table is grows and doesn't appear to have any significant challengers, the harder it will be for any potential competitors. See?
Interesting. I hadn't thought of the "admin makes reservations for her boss" angle yet. Brilliant! Open Table already gives points for usage, which can eventually be applied to free meals an any affiliated restaurant. Now, suppose a corporate admin could make reservations for a corporate lunch/dinner via a corporate opentable.com account. Every so often, the company saves money by getting free corporate lunches! The possibilities seem endless. Nice job BAGOFSWAGS!
Ignoring the obvious "little" boys on this thread...
I spend a lot of time dining socially (not work-specific) at "starred" locales. Everyone I associate with regularly depends on the Open Table mobile app. You wrote that don't personally make reservations at "starred" restaurants, so it's obvious why you believe what you do.
If I were you, I'd wonder how many of my assistants who make my restaurant reservations have tried and/or would prefer to use Open Table if they could. You might just be surprised....