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Cutera, Inc. Message Board

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  • qofaslave69 qofaslave69 Nov 25, 2005 12:00 PM Flag

    PE?

    afavorsky, I was using the YHOO & GOOG comparison as an ANALOGY to your ELOS & CUTR comparison. I am not saying that CUTR is a better comany than GOOG. Not even close...do you understand?
    You wrote that ELOS was in a better postion because of their lower PE than CUTR. I used the comparison that GOOG has a PE of 95 and YHOO is at 39. Why doesn't YHOO go up or GOOG go down? If it was that simple we could all make a killing in this market, and what fun would that be?

    I am NOT saying that GOOG is a better company than CUTR.
    CUTR investors are speculating (gambling) that earnings will continue to rise at incredible rates. You are betting against CUTR. That is the point. Good luck with your short position.

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    • OK, this I understand, no objections. Some other people on this board were saying that "cutr is the google of esthetic laser market", I thought you are going that way too. I absolutely agree that better companies deserve higher PE. The question is how convincing is the case that cutr is a better company.

      There are many ways google dominates yahoo, not just faster rate of profit growth. It has much faster revenue growth, clearly superior brand and market share. If cutr dominated elos and pmti the same way, I'd be all over cutr going long at current valuations. But it is very far from that. It has faster profit growth from smaller base, I'll give it a point. It has agressive marketing team and spends more on marketing, I'll give two. But this is not hard to counter, and clearly elos and pmti are addressing that. For example, elos has a new marketing deal with a pretty big distributor. Cutr has a tiny bit weaker revenue growth year over year than elos, let us call it a draw. This is generous to cutr, since last quarter the rate of growth was clearly superior for elos due to velasmooth. Cutr has weaker legal position, weaker research, and nothing to answer velasmooth.
      I'd call it an even match for now. Am I missing something? Let me know. OK, may be PE 30 for elos, 40 for cutr - an foreign discount. But 51/29? You got to be kidding. What a beautiful set up! Thanks, IBD!

      Regarding that I am the only short here - good. It always seems darkest just before dawn.

 
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