The_Liquid_Laser said:
Hahah, this is so dumb. How does dominant marketshare help me as an investor? It doesn't. It may make the company look big and impressive and I can still lose money as an investor. Nothing you say actually matters. What actually makes money for investors is 1) dividends and 2) increases in stock value. In the long term both of these are based on profits. Investors care about profits. The amateur investors are actually the ones that invest in a company just because it's big. It's quite possible to make a lot more money on smaller companies as long as the small companies make a good profit per share. And all of this ignores the fact that when Netflix started they were a small company renting out movies via the mail. They had high profits and a low marketshare. Literally, every part of your argument is terrible, lol. That takes talent. |
I can't believe what I'm reading. This is investing 101. Dominant marketshare is what the biggest companies in the world have. As an investor you have both options of going long, in what will likely become a safe rising stock or make profit from selling the stock in the expansion period.
2) is completely wrong. Stock value is speculative and can rise even without profits a la Amazon, Tesla, Netflix etc. MS's stock price has doubled in a year. Has there profits doubled to cause this? Of course not. What a ridiculous assumption.
You're also wrong on Netflix. Netflix became a pioneer in an entirely transformed industry: digital content streaming, and it did it all while not making a single bit of profit. Same with Amazon, delving into e-Commerce or Tesla with the EV manufacturing industry. See a trend here.
Aggressive expansion and domination, requires debt and induces thin margins, margins that can easily be increased once they've become the dominant players after market stabilisation.
To put it more simply:
Sony is on track to break records in the videogame industry and achieve $25 billion revenue. Nintendo is at $11 billion. Sony can achieve similar profits at a measly 20% margin while Nintendo needs a near 50% to match this.
Its only going to get more lopsided in the future, as Playstation has massive leverage over third parties, whose revenue stream rely on PS.
Agente42 said:
Nintendo is the most valuable Japanese company. Profits, dividends, etc. |
Not even close. Toyota, Softbank, Sony are all more valuable.
