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The methods and metrics taught in business school to assess company value—such as PE ratios and Return on Invested Capital—were developed for mature companies and are inappropriate for valuing young growth companies, like using a hammer to do surgery

causalpending

Speaker

Aswath Domodaran

Evidence Quote

“Most of the tools we have in finance were developed for mature companies-- PE Ratios, Return on Invested Capital, things you're taught in Business school. But if you have a growth company, you try to asses them using those tools. It's like using a hammer to do surgery.”

Source

Valuation in Four Lessons | Aswath Damodaran | Talks at Google— Talks at Google
Created: 8/11/2026, 1:45:13 AM

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