Seems reasonable. Then there is Intel. Their sales and profits are much higher now than in 2000, yet their stock has never touched those highs again. Same for Cisco. Other companies, great companies like Lucent, they don’t exist any more. Their stock value tanked first, then the problems became known. Growth companies in a bull market give you lots of reasons to own them, until they don’t. Some remain great. Some not so much.
I was around during the 1.0 crash too. I believe Saul was around too. I would like to hear Saul’s perspective as well. I remember, his 2008 experience was horrendous. However, I am truly impressed by his and everyone else’s performance here. I am not jealous, I am trying to make sense and learn and eventually profit from it. I have benefitted from OKTA, TTD among others, and hope to benefit from TWLO, ZEN, WDAY, ZS, SHOP, OKTA+TTD again, etc.
I am glad you brought up INTC. For last 20 years, INTC’s total return has been around 2.7% annualized (including dividends)
I was curious so I found out that they had a market cap of around $280 billion at the end of 1999 with $29 billion in revenue (i.e 10X P/S) and sub 30% gross margin. INTC wasnt capital light like many of the Saul’s companies loved on this board. And clearly the revenue wasn’t growing that fast. It is at $70 billion revenue today and $20 annual net income with only $230 billion market cap.
What’s the point? It is that inspite of the ridiculous valuation in 1999, the annualized return (including divs) was positive. Some of Saul’s companies are growing revenue above 70% per year. These are not fully formed businesses. David Gardener recently did a podcast titled “Where are you here?”. This was to illustrate, that paying high P/S on some companies in the past turned out to have a happen ending today. Those companies were ILMN, ISRG, CRM, etc (He probably picked a different list to illustrate)
I think Saul and his team here is onto something. And I want to participate inspite being value/growth at reasonable price investor. The board here is about “Growth at any price”. However, you folks are smart. You guys must be obviously doing something right. And I know what it is, but of course, I find it risky, hence I tread carefully and invest a small portion into many of these moonshot stocks. Because I know that in the long run, many can lose to the market, but some that beat it can do it by going up several hundred percentage points. Eg. AMZN, NFLX, GOOG, FB, ISRG, BIDU, ELLI, etc
Having said that, while what you guys have done is incredible, there is no need to make statements like “Why are you here?”. People are here because it is a popular board and has an excellent track record of catching the right trends. I dont think this is a dot com bubble 2.0. However, some hype stocks that are buying their way to growth might crash and burn. What we have learned from the winners is, you dont need too many to have a successful portfolio. Personally I prefer less risk, hence I cant be like Saul and put all my eggs in the growth basket. I do salute his and others courage. I participate in my own way and am OK with not quintupling my portfolio (400% is not quadruple). I hope you guys don’t mind having folks like me here, even if I can’t put 100% of my investing dollars in companies like ZS and OKTA.