Nice recovery today!!
https://seekingalpha.com/article/4277545-crowdstrike-much-hype
I was asked if I agree with the above article. Answer: part of it. I agree that crowd strike is very highly valued. The reason for that high valuation is both incredible revenue growth of greater than 115% and very high margins around 90%. This article claims several times that growth is going to drop to 50%, which I don’t agree with right now and we have no way to know or expect. The company has executed on 100% growth or more for two or 3 quarters in a row now at least and has actually accelerated. I certainly will watch it for deceleration of revenue growth, but would question his assumption here. At over $18 billion market cap though and 30x revenue (assuming his math is right here), I cannot argue that this is richly valued and that is the reason it is my smallest position and I will not allow it to exceed 2 or 3% of my portfolio at this point. With the recent run up in price, I chose to sell a small number of shares yesterday to bring it back down to 2%. If you watched, it has been up significantly every day since the earnings call and another 6% yesterday. Certainly at this point it may be a little overdone technically. Cheers!!
