| Borgqueen | Sunday, June 14, 2020 - 09:39 pm 
The Corp Lula Platinum in our Enterprise Trading Submatrix 001 has Assets of more than 81B, available Cash of almost 43B, supplies of about 24B and making profit constantly and it says the market value of said corp is only 49B. How comes? |
| freeya1980 | Monday, June 15, 2020 - 02:47 pm
This is cause corporation value in this game is tied to earnings per share and P/E ratio, and its a VERY LONG (too long) delay (2-4 game years). I've already complained about this once.
I've actually had corporations that were profitable for 3-4 years straight still sinking in value (to below 10B in a few cases), because their P/E hadn't fallen below about 50ish yet. On the flip side, I've had corporations losing money for a couple years and still gaining value, due to their P/E not going above 50ish. I mean I understand the desire not to have P/E react to sudden profit changes, but the current implementation is extremely poor, the delay is making value not match reality whatsoever. In a few cases I've had corporations have a large loss, then a large profit, then a large loss, then a large profit again (over say 4-5 years), and NOT ONCE rise in value (military supplies on WG is an example, I can surely find others). |
| Borgqueen | Monday, June 15, 2020 - 09:30 pm
We wouldn't mind but there is a hostile CEO on WG placing bids on newer natural res corps of different Enterprises and gains them really cheap due to this. |
| freeya1980 | Tuesday, June 16, 2020 - 08:03 am
You could bid on some of his corporations. It's kind of a shame its quite easy to "steal" corporations from other CEOs.
To Andy: This being trivially easy for a large and cash flush CEO to buy up corporations from smaller or newer CEOs is definitely a good way to make new players quit or disband their enterprise. As you know, there's very few enterprises as it is across all 5 worlds compared to how it used to be. |
| freeya | Tuesday, June 16, 2020 - 09:47 am
I'd recommend increasing the amount of time before a new corporation can be bid on. I believe currently its 24 months? Double that. That should give the owner of the corporation enough time to increase its value so a hostile takeover is more expensive if its a highly profitable corporation. |
| Andy | Friday, June 19, 2020 - 05:47 pm
The market value of a corporation should not jump up and down by a large margin because the sale of the product or its price stagnate for a short period.
it should be based on a longer term profit level.
The market value is based on sales in a period of 14 to 20 months.
(6 months in a real day).
if the corporation is doing good, the value starts improving directly but does not jump.
In public corporations changes depend on buy and sell orders and prices fluctuate by a single digit percentage per game month. |
| Borgqueen | Saturday, June 20, 2020 - 10:35 am
We agree it shouldn't just jump around. But maybe you could consider new corporations to start at the value of what it cost to set up and cash/assets it contains. This way new corps couldn't be bought at rediculous low prices just because they couldn't build up their worth through sales. |
| Andy | Monday, July 13, 2020 - 10:07 pm
I looked into this suggestion.
It makes sense to start at a value that is higher to prevent an early takeover.
the issue is with the way the value is computed.
It depends on the profit or loss of the corporations.
I will try to find an easy way to start higher. |
| Andy | Tuesday, July 14, 2020 - 11:46 am
One way we can solve this problem is by protecting young corporations, age <48 months, against a takeover. |
| Jiggle Billy | Tuesday, July 14, 2020 - 01:37 pm
It seems to me corporate assets should factor into the value at all ages of the corporation. If a real business has $10 Million cash and no debt but also no revenue its still worth about $10 Million. I've had multiple corporations in this game be valued less than their cash holdings. |
| Andy | Wednesday, July 15, 2020 - 01:48 pm
Assets are always a factor but the value of corporations also depends on their capacity to create profits now and later.
making the value depend too much on their assets, opens the way to manipulations as it is easy to move cash in and out of the corporations.
The PE ratio is an indicator of the profitability of the corporation and a major factor in their value in Simcountry but also in the real world. |
