《商务英语翻译》课外翻译作业(第一次).docVIP

2. The danger of Billion-Dollar Valuations Recently, investors celebrated the birthday of the current bull market, which turned five years old. On this anniversary, its worth reflecting on how valuations, particularly of technology companies, are being calculated. On Thursday, the Wall Street Journal reported that Airbnb, a travel rental company, which has not released information about its revenue or profitability, may be approaching a valuation of $10 billion. Other startups in the IPO pipeline include a number of unprofitable companies like Box and Square, with rumored valuations in the billions. Have billion-dollar or multibillion-dollar valuations become the norm? Is it all about hype and greed nowadays? Whatever happened to the wisdom of investors like Warren Buffet who evaluated companies based on their profits and fundamental performances? The value of any company is a function of the cash flow it will generate in the future. A healthy cash flow allows a company to repay its shareholders and initial investors who, understandably, expect their investment to be eventually reimbursed. Ordinary investors who rely on the hype surrounding a company rather than the companys fundamentals may make decisions that they regret later on. Just ask anyone who invested in the P IPO about the danger of falling for overvalued companies. Granted, everyone in the tech industry -- from startup founders to venture capitalists -- is eager to find and bet on the next big thing. Still, the money being thrown around is mind-boggling. Even a decent business model and the potential for growth do not justify a multibillion-dollar valuation. Yet, Facebook recently offered an astounding $19 billion to buy WhatsApp, a popular messaging service. Though WhatsApp has reportedly been able to turn a small profit, this overblown acquisition price is higher than the market cap of 275 companies in the SP 500. Some market watchers have argued, as Michael Wolf did on CNN.com, that the WhatsApp acqu