So notice.

Because when someone says earnings, are those the earnings last year?

We learned that in our first video.

The overhead went up.

The earnings I just said, this is actually what happened to the company.

And how they were going to create demand was through search ads, social media, stadium promotions.

Maybe it goes to 2 in 2010.

So a plus b have to be equal to 50.

In this case, we use last year's earnings.

And the other reason is, this was just 2008 earnings.

Profitable.

These are key metrics.

You always have to be looking forward.

So let me write this down.

Maybe Abby made 50 and Ben earned 0.

And we can eyeball it right here.

Company C is trading at 100.

And B is expected to make 4 per share.

What if the bake sale only netted 71 dollars for charity because it made no investment in its scale and the professional fundraising enterprise netted 71 million dollars because it did?

Everything on this line would be a valid combination of

You don't know.

Let's compare EBlT to operating profit.

Are you using future earnings?

So these are the people, gee, subscription and half pay rental, let's do some math.

But for our sake, let's just say that when you give the widget, you have earned the money that they give you, and that's revenue sales.

So let's look at them over the course of one year.

Invest financial assistance, but also management assistance.

You get 400 from the customer the previous month.

And then their pre tax profit is going to be the same thing as the operating profit, so minus 100,000, minus 100,000, 400,000 I'll make the good years in green 400,000.

If it's growing 100 a year for 20 years, this is actually a very good deal.

The price to 2008 earnings for Company B is 4.

Earnings ratio of 4.

But it's going to continue to grow.

Just to give you one example

What does that tell us?

It's just 10 because one, this is a nice round number.

It's the same plot.

When? I said it's time to monetise the site.

And that money that they give you and I'm not going to get too technical about the accounting right now is considered revenue.

And the way that you account for this 200 in advance from a customer, is you call that deferred revenue.

Well, if you think about it, in a new market on year 1 you have no customers, and so your revenue is essentially flat.

The reason why you are willing to pay a higher Price to

And what's left over for the equity?

So let me switch colors just to ease the monotony.

And they were male and female 18 30 and they were casual fans.