That post by a SA contributor uses a price/sales (P/S) metric to justifty the current price per share. On its own, a ratio is not much - we have to compare it to, say, similar companies. If we choose to use one ratio for valuation, we should also look at the others too.
In addition. P/S is more useful for early stage companies with no profits (hence the emphasis on sales and not earnings, such as net profit or EBITDA).
ZOOM is a profitable company. It’s very popular, an amazing growth story, is removing the skeletons from the closet, but the traders (and algorithms) have pushed the price to beyond the happy days of Virgin Galactic earlier this year. Time will tell whether it’s a sustainable $200 stock or not.
But it’s all relative.
http://pages.stern.nyu.edu/~adamodar/pdfiles/country/relvalAIMR.pdf
(Prof. Damodaran is said to be the first prof. to offer valuation classes at business schools - Equity analysis: post-Covid-19 Jedi guide to investing - Aswath Damodaran (Musings on Markets))
