slymeat
2 weeks ago

Finding the next big thing has absolutely nothing to do with sales.

Sometimes you need to look at potential to earn/grow, not just current sales. Looking at sales to value a company would still keep you out of the likes of AfterPay and Pointerra.

Yes hiccups can leave you holding the bag, but the other side of that story is multi-bag. 

IMHO, P/S only becomes important for well established companies. Eventually, all companies need to make money in order to survive, and until then, DCF, P/E, P/S, current ratio, etc. are all useless and can't value companies in their early rapid growth phase.

it is very relevant that "with earnings comes growth", but I also feel that much more growth comes before earnings and is driven by potential to earn, by novelty, and by being first.

 

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Brisvegaxe
2 weeks ago

Good luck  , time will tell how well this ages .  

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Noicewon11
2 weeks ago

IMHO, P/S only becomes important for well established companies. Eventually, all companies need to make money in order to survive, and until then, DCF, P/E, P/S, current ratio, etc. are all useless and can't value companies in their early rapid growth phase.

 

I can see a few reasons why someone wouldn't agree with this.

Firstly, a DCF valuation invovles extrapolating future cash flows and discount them to present value. Thus if one is able to deduce cash flows in the future, given the company may not be FCF positive now (but will be at soime future point), it is still possible to use a DCF to value a company.

The same can be applied to P/e, current ratio etc. If we can have an understanding of what company ABC will earn in 5 years time, then we use these ratios to value the company based on future earnings/assets and discount this back to PV.

I don't agree that because a company isn't earnings/FCF positive & multi bags then therefore one can conclude these measures are "useless".

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slymeat
2 weeks ago

Will The next acronym be SHIPSAPP?

Although the following have already had a decent run, I believe they have a lot of potential left in them. Will this be the next WAAAX?

Strategic Elements is a particular favourite of mine, it has so many balls in the air, and any one of them could make the company. Plus it is a Pooled Development Fund - no CGT.

Hazer - a Hydrogen play, probably the biggest and most advanced in Aus

IMU - immunotherapy for cancer. It is getting impressive results from stage 2 trials.

PushPay - I probably don‘t need to say anything about this company. With 68% growth this year I feel it underperformed.

Secos - biodegradable plastics. This is definitely a thing of the future. Secos is making money.

Alcidion - digitising hospital patient management. Hitting an inflexion point of positive cash flow.

Pointerra - 3D spatial data processing. I see promise in its recent acquisition and believe the market hasn’t fully appreciated what these boots on the ground in the US may bring to the party.

PME - I can’t see anything that will stop this company growing. I still regret selling at $12.80, but at least I did get back in at $28.

 

 

DISC: I hold positions in all SHIPSAPP companies.

 

 

 

 

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Scarcrow
2 weeks ago

SXE, 

HSN,

IBX,

TNE,

 

ALU,

SWF,

SVW.

 

Work that one out

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Brisvegaxe
2 weeks ago

"PME - I can’t see anything that will stop this company growing. "

 

Well if there is a hiccup in growth you become a bag holder .   The growth is well and truly priced in at ridiculous multiples of sales  . Personally i cant get involved in companies trading at these metric extremes but i am old school and have seen too many blowups of these types of companies  . I might even start a list of the mega price to sales crowd .  Many of these are / become stellar short seller targets  

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