one thing which felt a bit strange - you mentioned Peter Lynch's quote and use Snowflake in the same paragraph. like, have you seen Snowflake's PE multiple?
“Invest in what you know & see around. Always ensure the long-term growth rate is greater than the P/E Ratio you pay. Any business that manages to keep a 20% growth rate for 20 years will reward shareholders with a massive return, even if the stock market overall is lower”
Software companies in a high-growth phase are best valued at EV / Sales, as high growth requires substantial investment i.e. product capabilities need to be build out and intensive sales & marketing are needed to win new clients and get them up and running. So new and potential clients are loss-making, whereas once a customer is with you for more than a year, he becomes high margin. This blurs the profitability picture.
A beautiful and concise analysis of some of the companies I own. I liked the rational way of writing without technical jargon, which is usually very difficult to understand for a person like me who has no know-how of technology.
bro, thank you very much for all your work.
one thing which felt a bit strange - you mentioned Peter Lynch's quote and use Snowflake in the same paragraph. like, have you seen Snowflake's PE multiple?
“Invest in what you know & see around. Always ensure the long-term growth rate is greater than the P/E Ratio you pay. Any business that manages to keep a 20% growth rate for 20 years will reward shareholders with a massive return, even if the stock market overall is lower”
Software companies in a high-growth phase are best valued at EV / Sales, as high growth requires substantial investment i.e. product capabilities need to be build out and intensive sales & marketing are needed to win new clients and get them up and running. So new and potential clients are loss-making, whereas once a customer is with you for more than a year, he becomes high margin. This blurs the profitability picture.
This was excellent, thanks for the valuable insight and review.
Thank you Evan
Very good idea and clean, easy-to-read format od portfolio summary. Very helpfull :)
Thank you Krajcz
A beautiful and concise analysis of some of the companies I own. I liked the rational way of writing without technical jargon, which is usually very difficult to understand for a person like me who has no know-how of technology.