Originally Posted by
SparkyTheClown
Yes, I agree. I can perfectly understand a valuation of around $8.50-$9.00 a share, based on price/sales of 25 or so, rather than the 39 it is at the moment. It is hard to get a feel for Xero because they don't disclose churn and a couple of other useful metrics like other SaaS companies do.
Price/Sales for established SaaS companies tend to be under 10, but of course, Xero is growing heartily and is young.
I do acknowledge that they have a strategy, a CEO who has a track record, a board who has endorsed the vision, and strategic investors who back that vision. So I'm not arguing its a bad company!