NJ5 on 05 August 2008
| Pristine20 said: I just found out that PetroChina is more valuable than ExxonMobil even though it made less profit. What gives?
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The latest company profits don't matter that much. For example, many banks have lost a lot of money recently, but that doesn't mean they don't have assets anymore.
What can happen is that when a company makes small profits or loses money for a long enough time, investors can decide that it means the assets are not worth as much anymore. As a consequence, there will be a sell-off and the stock price (and market cap) will go down.
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