It is much easier to take some "over valuation" risk with your model if the valuation has a modest market cap. The problem with RAC is any attempt to build a bottom up model ends with ludicrously high valuations that require exceptionally low probabilities of success to stay within range of the current market cap.
Of course the probability of success might not actually be exceptionally low and the market has just got the valuation of RAC totally wrong. Working out if the market is wrong or right is the job of every investor.
I would add history does suggest that Australian investors have great difficulty accurately valuing biotech companies, so the market being wrong is not uncommon. Isn't investing fun
Ann: Race In-person Investor Briefing Invitation Perth, page-59
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Last
$1.69 |
Change
0.000(0.00%) |
Mkt cap ! $288.0M | |||
| Open | High | Low | Value | Volume |
| $1.69 | $1.69 | $1.65 | $179.8K | 108.0K |
Buyers (Bids)
| No. | Vol. | Price($) |
|---|---|---|
| 1 | 1437 | $1.65 |
Sellers (Offers)
| Price($) | Vol. | No. |
|---|---|---|
| $1.74 | 3313 | 1 |
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| Last trade - 15.58pm 03/10/2024 (20 minute delay) ? |
| RAC (ASX) Chart |