On tech investing for a non-techie
As I’ve often explained, I have no techie skills. I don’t even know what most of the words mean. Yet I invest in a lot of tech stocks. How do I do it?
I was brought to write this by rereading my post #38019 (Pure Storage – Additional Evaluation), and reading a lot of the posts by some of you guys who know a lot more about the tech aspects and arguing over arcane issues with regards to Pure and Nutanix where I don’t even know what you are talking about.
What my evaluation was based on was mostly the numbers Pure was putting up: accelerating growth rate, operating margin, cash flow, profitability, customers, partnerships, market share. That works for me. Clearly Pure has stuff that its competitors don’t have or it wouldn’t be growing as it is. I don’t need to understand how it all works.
Look when they say:
We expect NVMe to grow very rapidly in our portfolio, eventually extending to most of it and part of our competitive advantage is we were first, we have the performance of the underlying software and architecture to allow NVMe to be most effective and fast. And it’s been driving a lot of our growth in in customers. Frankly we are the only player that can provide the performance necessary to address their application environments. I will just add to that our approach has really been a software centric one.
When I read that, do I have to know what NVMe means? (I don’t have a clue). But what I know is that it’s something important and that they are way out ahead, and expect to stay there.
And it’s not just high tech. If I was investing in a restaurant chain (which I don’t usually), I wouldn’t know how to run a restaurant. I’d look at the numbers, and the special sauce (pun intended). When I was in LGIH, I didn’t have a clue how to build a house either.
Just a reflection.
Saul