Offshore
Photo
AkhenOsiris
RT @MuppetTrading: Another day, another weaker $CRWD datapoint, this time via Keybanc VAR survey. More and more starting to look like SP500 add was THE top.
tweet
RT @MuppetTrading: Another day, another weaker $CRWD datapoint, this time via Keybanc VAR survey. More and more starting to look like SP500 add was THE top.
tweet
Offshore
Photo
AkhenOsiris
@SaaSletter Is the biggest problem defining what constitutes AI? The stories are all over the map.
"AI didn't meaningfully help out our org"
"AI has saved us x% in y costs"
"Our AI revenue is now z"
tweet
@SaaSletter Is the biggest problem defining what constitutes AI? The stories are all over the map.
"AI didn't meaningfully help out our org"
"AI has saved us x% in y costs"
"Our AI revenue is now z"
How is AI impacting your team's productivity? In our latest research, preliminary estimates of AI impact reveal notable productivity gains of 20-30% and an estimated revenue impact of 16%. Learn more: bit.ly/3RtgBga - ICONIQ Growthtweet
AkhenOsiris
RT @DanielBZhao: Data centers & AI get a Beige book mention
> Utility contacts reported increasing power demand in commercial and industrial segments, largely attributed to new and expanding data center projects focused on the growing use of artificial intelligence technology.
-Atlanta
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RT @DanielBZhao: Data centers & AI get a Beige book mention
> Utility contacts reported increasing power demand in commercial and industrial segments, largely attributed to new and expanding data center projects focused on the growing use of artificial intelligence technology.
-Atlanta
tweet
Offshore
Video
Aswath Damodaran (Youtube)
The Corporate Life Cycle: Implications for Managing and Investing
For much of the last decade, I have been incorporating the idea that companies age, just like human beings do, and with just as much reluctance, into my corporate finance, valuation and investment philosophies classes. In short, it has become my one unifying construct that I can use to explain or at least talk about almost every phenomenon in business. Drawing on those lessons, and my many blog posts on the corporate life cycle, I have written a book on the topic, soon to be published by Penguin Random House. The book starts with a description of the life cycle, and the determinants of its length and shape, and then has four separate sections (each with 3-5 chapters) on implications for corporate finance, valuation, investing and management. I hope you enjoy the book as much as I enjoyed writing it.
Publication date: Late August, 2024
Links to book (for pre-order):
Amazon: https://www.amazon.com/Corporate-Lifecycle-Investment-Management-Implications/dp/0593545060
Barnes & Noble: https://www.barnesandnoble.com/w/the-corporate-life-cycle-aswath-damodaran/1143170651?ean=9780593545065
Bookshop.org: https://bookshop.org/p/books/the-corporate-lifecycle-business-investment-and-management-implications-aswath-damodaran/19850366?ean=9780593545065
Apple: https://books.apple.com/us/audiobook/the-corporate-life-cycle-business-investment/id1680865376
There will be an Indian edition that should come out at about the same time, which will be available on Indian online sites as well.
The Corporate Life Cycle: Implications for Managing and Investing
For much of the last decade, I have been incorporating the idea that companies age, just like human beings do, and with just as much reluctance, into my corporate finance, valuation and investment philosophies classes. In short, it has become my one unifying construct that I can use to explain or at least talk about almost every phenomenon in business. Drawing on those lessons, and my many blog posts on the corporate life cycle, I have written a book on the topic, soon to be published by Penguin Random House. The book starts with a description of the life cycle, and the determinants of its length and shape, and then has four separate sections (each with 3-5 chapters) on implications for corporate finance, valuation, investing and management. I hope you enjoy the book as much as I enjoyed writing it.
Publication date: Late August, 2024
Links to book (for pre-order):
Amazon: https://www.amazon.com/Corporate-Lifecycle-Investment-Management-Implications/dp/0593545060
Barnes & Noble: https://www.barnesandnoble.com/w/the-corporate-life-cycle-aswath-damodaran/1143170651?ean=9780593545065
Bookshop.org: https://bookshop.org/p/books/the-corporate-lifecycle-business-investment-and-management-implications-aswath-damodaran/19850366?ean=9780593545065
Apple: https://books.apple.com/us/audiobook/the-corporate-life-cycle-business-investment/id1680865376
There will be an Indian edition that should come out at about the same time, which will be available on Indian online sites as well.
Offshore
Photo
Dimitry Nakhla | Babylon Capital®
RT @DimitryNakhla: ~2 & 1/2 months ago I shared my “sober valuation analysis 🧘🏽♂️” on $QLYS stating:
“Albeit, for investors that prefer to consider the downside first (as myself) the current assumptions don’t leave us with a margin of safety
I’d become interested in $QLYS closer to 28x earnings or at $145💵 (~12.5% below todays price)
I understand I may be asking for too much on the valuation — however I don’t view it that way considering competition in the sector & $QLYS slowdown in growth which could lead to a re-rating in its multiple”
Since then, $QLYS dropped ~18% & is currently trading at $134.73💵, slightly below my $145💵 target
While I remain interested in $QLYS, I'm hesitant to add shares at present due to the competitive landscape, sector slowdown, preference to own $FTNT & $PANW over $QLYS, and the availability of other attractive opportunities in the market that have a wider moat
#stocks #investing"
A sober valuation analysis on $QLYS 🧘🏽♂️
•NTM P/E Ratio: 32.03x
•5-Year Mean: 37.39x
•NTM FCF Yield: 3.58%
•5-Year Mean: 3.63%
As you can see, $QLYS appears to be trading slightly below fair value
Going forward, investors can receive ~17% MORE in earnings per share & about the same in FCF per share 🧠***
Before we get into valuation, let’s take a look at why $QLYS is a quality business
BALANCE SHEET✅
•Cash & Short-Term Inv: $425.56M
•Long-Term Debt: $0
$QLYS has an excellent balance sheet
RETURN ON CAPITAL✅
•2019: 16.5%
•2020: 20.9%
•2021: 23.7%
•2022: 39.4%
•2023: 41.1%
RETURN ON EQUITY✅
•2019: 18.6%
•2020: 23.1%
•2021: 16.9%
•2022: 29.8%
•2023: 46.1%
$QLYS has strong return metrics, highlighting the financial efficiency of the business
REVENUES✅
•2013: $107.96M
•2023: $554.46M
•CAGR: 17.77%
FREE CASH FLOW✅
•2013: $11.43M
•2023: $235.82M
•CAGR: 35.34%
NORMALIZED EPS✅
•2013: $0.20
•2023: $5.27
•CAGR: 38.70%
SHARE BUYBACKS❌ / ✅
•2013 Shares Outstanding: 35.97M
•LTM Shares Outstanding: 37.60M
However, from 2018 - 2023, $QLYS reduced its shares outstanding ~10.2%, increasing its EPS by ~11.3% (assuming 0 growth)
MARGINS✅
•LTM Gross Margins: 80.6%
•LTM Operating Margins: 29.4%
•LTM Net Income Margins: 27.3%
***NOW TO VALUATION 🧠
As stated above, investors can expect to receive ~17% MORE in EPS & about the same in FCF per share
Using Benjamin Graham’s 2G rule of thumb, $QLYS has to grow earnings at a 16.02% CAGR over the next several years to justify its valuation
Today, analysts anticipate 2024 - 2026 EPS growth over the next few years to be less than the (16.02%) required growth rate:
2024E: $5.19 (-1.5% YoY) *FY Dec
2025E: $5.71 (10.1% YoY)
2026E: $6.67 (16.8% YoY)
$QLYS has an excellent track record of meeting analyst estimates ~2 years out, so let’s assume $QLYS ends 2026 with $6.67 in EPS & see its CAGR potential assuming different multiples
35x P/E: $233.45💵 … ~13.5% CAGR
32.5x P/E: $216.77💵 … ~10.4% CAGR
30x P/E: $200.10💵 … ~7.3% CAGR
As you can see, $QLYS needs to trade closer to >32.5x earnings for it to have double-digit return potential
This isn’t unreasonable given $QLYS historical valuation & financial efficiency — moreover, $QLYS has maintained fairly strong support near that 32.5x level
$QLYS appears to be a great business treading for a fair price
Albeit, for investors that prefer to consider the downside first (as myself) the current assumptions don’t leave us with a margin of safety
I’d become interested in $QLYS closer to 28x earnings or at $145💵 (~12.5% below todays price)
I understand I may be asking for too much on the valuation — however I don’t view it that way considering competition in the sector & $QLYS slowdown in growth which could lead to a re-rating [...]
RT @DimitryNakhla: ~2 & 1/2 months ago I shared my “sober valuation analysis 🧘🏽♂️” on $QLYS stating:
“Albeit, for investors that prefer to consider the downside first (as myself) the current assumptions don’t leave us with a margin of safety
I’d become interested in $QLYS closer to 28x earnings or at $145💵 (~12.5% below todays price)
I understand I may be asking for too much on the valuation — however I don’t view it that way considering competition in the sector & $QLYS slowdown in growth which could lead to a re-rating in its multiple”
Since then, $QLYS dropped ~18% & is currently trading at $134.73💵, slightly below my $145💵 target
While I remain interested in $QLYS, I'm hesitant to add shares at present due to the competitive landscape, sector slowdown, preference to own $FTNT & $PANW over $QLYS, and the availability of other attractive opportunities in the market that have a wider moat
#stocks #investing"
A sober valuation analysis on $QLYS 🧘🏽♂️
•NTM P/E Ratio: 32.03x
•5-Year Mean: 37.39x
•NTM FCF Yield: 3.58%
•5-Year Mean: 3.63%
As you can see, $QLYS appears to be trading slightly below fair value
Going forward, investors can receive ~17% MORE in earnings per share & about the same in FCF per share 🧠***
Before we get into valuation, let’s take a look at why $QLYS is a quality business
BALANCE SHEET✅
•Cash & Short-Term Inv: $425.56M
•Long-Term Debt: $0
$QLYS has an excellent balance sheet
RETURN ON CAPITAL✅
•2019: 16.5%
•2020: 20.9%
•2021: 23.7%
•2022: 39.4%
•2023: 41.1%
RETURN ON EQUITY✅
•2019: 18.6%
•2020: 23.1%
•2021: 16.9%
•2022: 29.8%
•2023: 46.1%
$QLYS has strong return metrics, highlighting the financial efficiency of the business
REVENUES✅
•2013: $107.96M
•2023: $554.46M
•CAGR: 17.77%
FREE CASH FLOW✅
•2013: $11.43M
•2023: $235.82M
•CAGR: 35.34%
NORMALIZED EPS✅
•2013: $0.20
•2023: $5.27
•CAGR: 38.70%
SHARE BUYBACKS❌ / ✅
•2013 Shares Outstanding: 35.97M
•LTM Shares Outstanding: 37.60M
However, from 2018 - 2023, $QLYS reduced its shares outstanding ~10.2%, increasing its EPS by ~11.3% (assuming 0 growth)
MARGINS✅
•LTM Gross Margins: 80.6%
•LTM Operating Margins: 29.4%
•LTM Net Income Margins: 27.3%
***NOW TO VALUATION 🧠
As stated above, investors can expect to receive ~17% MORE in EPS & about the same in FCF per share
Using Benjamin Graham’s 2G rule of thumb, $QLYS has to grow earnings at a 16.02% CAGR over the next several years to justify its valuation
Today, analysts anticipate 2024 - 2026 EPS growth over the next few years to be less than the (16.02%) required growth rate:
2024E: $5.19 (-1.5% YoY) *FY Dec
2025E: $5.71 (10.1% YoY)
2026E: $6.67 (16.8% YoY)
$QLYS has an excellent track record of meeting analyst estimates ~2 years out, so let’s assume $QLYS ends 2026 with $6.67 in EPS & see its CAGR potential assuming different multiples
35x P/E: $233.45💵 … ~13.5% CAGR
32.5x P/E: $216.77💵 … ~10.4% CAGR
30x P/E: $200.10💵 … ~7.3% CAGR
As you can see, $QLYS needs to trade closer to >32.5x earnings for it to have double-digit return potential
This isn’t unreasonable given $QLYS historical valuation & financial efficiency — moreover, $QLYS has maintained fairly strong support near that 32.5x level
$QLYS appears to be a great business treading for a fair price
Albeit, for investors that prefer to consider the downside first (as myself) the current assumptions don’t leave us with a margin of safety
I’d become interested in $QLYS closer to 28x earnings or at $145💵 (~12.5% below todays price)
I understand I may be asking for too much on the valuation — however I don’t view it that way considering competition in the sector & $QLYS slowdown in growth which could lead to a re-rating [...]