That's still way more expensive than most companies.

And why don't you like them as much?

Well in this case, you're uncertain about the earnings stream.

They're going to make 0.35 in 2009 as well.

The company's profitability improved.

So this is trailing 12 months.

Do we go for lots of users and then say if we get 10 million people the revenues will come?

So a plus b have to be equal to 50.

When I look at an existing market, it's clear that if you've match those market needs, you could be achieving profitability the soonest.

This was a startup killer for decades.

And B is expected to make 4 per share.

If you're doing a clone market that is copying a US business model in a foreign country, that probably is the second closest to immediate profitability because you know the market exist that you just need to implement it in your local country.

Profitable.

Are you using future earnings?

Invest financial assistance, but also management assistance.

And we can eyeball it right here.

Resegmented market well, that's probably somewhere in between existing in clone and new because you not only have to understand the market you have to understand the customer's specific needs or low cost needs.

Maybe Abby made 50 and Ben earned 0.

It's called the Extractive Industries Transparency Initiative.

So it has a Price to Earnings of 50.

Divided by 0.35.

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

And what's left over for the equity?

The difference with Ecosia though is that, in Ecosia's case, it draws the revenues in the same way, but it allocates 80 percent of those revenues to a rainforest protection project in the Amazon.

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

Sometimes we're profitable. Sometimes we're not.

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

So notice.

Everything on this line would be a valid combination of

Abby earned 10 more than Ben.

So the price would be 100.

Another type of revenue model is licensing.

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

So let me switch colors just to ease the monotony.

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

So let's say the revenue or the sales in this case in a given period, let's say that this is an income statement for 2008.

Let's say that we don't know that they're truly equal.

And the first one is that this whole idea about revenue stream, Steve, I get it.

The other side are the people using Google Adwords to look for keywords.

What does that tell us?

It's just a faster way of saying

It looks like our profit is jumping all over the place.

So now we add an interesting line.

This is really important to pay attention to, because so many people say, oh, a company made this much.

And we add back the interest, at least in this example, we get to an operating profit number.