Okta: If You Have To Ask, You Can’t Afford It $OKTA
https://seekingalpha.com/article/4272481
Twilio’s Valuation Is Way Too Frothy $TWLO
https://seekingalpha.com/article/4272395
Two articles For your reading leisure.
My take: Make no mistake, the stocks in the portfolio have very high valuations. And I have received these dire warnings for several years now pertaining to many of the stocks I/ we own. If I had listened to the pundits, nay sayers and short sellers, I would have sold these stocks or never bought them several years ago and would thereby have missed out on the 300% returns! They are valued very high because the companies are growing by 60-100% quarter over quarter for 8 quarter or more in a row. The result is that the valuation, which ever method you choose, gets reduced in half over and over again each quarter or year and quickly either becomes cheaper or the price of the stock continues to increase and it is valued still higher to reflect the higher and continued growth. But when you have company like ours that have 80 to 90% margins, revenue growth exceeding 60% at minimum, rapid customer acquisition and incredibly high Net customer retention rates, of course you will have high valuations. My point is that you have to take these articles with a grain of salt and do your own homework. I look at the quarterly earnings reports very closely and immediately upon release to ascertain if the growth is slowing down because certainly our company’s Stock prices will take a huge hit when they do start to slow down their growth. Until then, I fully expect these companies to continue to have astronomical valuations. They can be risky, but that is why I continue to get higher returns. I am not looking for stocks like GE, AT&T, or Clorox that yield at most 1 or 2% average returns. I’m looking for ferocious growth and Companies who can 5-10x themselves in the next 3 to 5 years.
Cheers from Hanover, Germany.
