Coca-Cola trades at 40x trailing cash flow and 49x forward cash flow.
Its revenues grow at less than 4% annually.
NVIDIA trades at 54x and 42x trailing and forward cash flow, respectively.
Their revenues grow at +65% annually.
I want you to look at those numbers and tell me that AI is in a bubble.
Seriously. Reply to this email and explain it to me. I'd love to hear the logic.
Think this is an outlier?
How about another one…
Walmart trades at 22x trailing cash flow and 25x forward cash flow with <5% revenue growth.
Microsoft trades at 24x and 21x, respectively, with +15% revenue growth.
The AI trade is dead? Give me a break.
Yes, there are stocks that have no business at their current valuations (Coreweave comes to mind).
But it defies logic to look at the fundamentals of these companies and say they're grossly overvalued.
And I dare you to prove me wrong. I'm looking at you, Professor Bierman.
Jordan Schneir
Editorial Director, TheoTRADE
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