Never? Perhaps you meant "at least not by simply easing off the gas
Yes, I should have explained myself better. What I should have said is that SKX will never increase earnings six fold relative to its sales.
Through growth it absolutely can grow earnings six-fold, and hopefully will.
Ian
Long SKX and UA
If I understand baggers correctly a 100 bagger is a 1000% increase from your purchase price.
Hi Bruce, A 1000% increase from your purchase price gives you an 11 bagger.
Saul
Kevin, yes, I agree. The proof is in the pudding, or a show me the money style of investing. I completely agree.
As Ian posted, UA is heavily investing in growth, so once they slow the investment and bring the earnings to the bottom line, it will make the valuation much more reasonable.
Of course that is a big IF, and many things could derail plans before that happens.
It much like AMZN, who this quarter had huge gains after posting a tiny profit. Insane valuation. My favorite analysis I saw on the earnings was someone who said that AMZN is basically messing with Wall St because they can post a profit anytime they want, and its funny how such a small positive number caused such a big response.
Now, I think AMZN is a great company, but I don’t own it. I like UA a lot as well but I understand the risk vs SKX which I also think is a great company.
I’d put new money in SKX of course. Easy decision. UA shares will need to wait a bit, since >90% of the position is a taxable gain, and the tax bill is already getting hefty for this year from some reallocating I’ve been doing lately, but at these prices I am looking to scale out.