Evaluation of company with needs to change. Current stock evaluation is based off of a few key indicators of company health. Primarily book to bill, net revenue growth, and market trends.
Utilizing these a company has no choice but to grow year over year, industry standard for my company is 1.2 year over year. That means we need about 20% growth in new business award to show viability. Now if they don’t hit this, which is the case when the economy slows, for instance when interest rates spike or there is tentative investment due to market scare, corporations will lower over head cost to ensure the net revenue growth remains consistent. This will ensure that they offshore US based jobs or look for alternatives such as A.I.
If we don’t want AI replacement or shifting of US jobs, company evaluation needs to shift.