3 ms·

It's absolutely insane. By historical standards, we're in the Dot-com bubble territory already. This is now a 1T$ valued business, based on ... 20B$ annual rev

It's absolutely insane. By historical standards, we're in the Dot-com bubble territory already. This is now a 1T$ valued business, based on ... 20B$ annual revenues, say (generously) 10B$ annual profit, and A LOT of hype. (I would never recommend trying to short it though - the market can stay irrational longer than ... )

cvccvroomvroom 3y ago
Meta is spending 20 B / yr on mostly Nvidia-powered servers. Doing so without a product strategy to utilize them.
what_ever 3y ago
Not saying anything about the valuation but they just provided a guidance of $11B revenue for the next quarter which is about 50% more compared to the quarter they just reported for...
- TheAlchemist 3y ago
  Yeah, but let's more than double that - and say they make $100B of revenue per year. That's still a Price / Sales ratio of 10 ! Price to sales, not price to earnings !!! You never know, maybe this AI thing is not just hype (I think it is for now), and maybe NVidia will basically own the future of AI computing chips - if that's the case, then okay - this valuation will be OK - but this valuation is here, now ! And a huge company stock price is moving by 20-30%. This is absolutely bonkers. Know, a lot of financial reporting happens on periodical basis (be it end of day or month) - it kind of assumes that things are not moving too wildly and you can put some trust in it. Which is usually the case for big companies. But lately, we see those top N companies in US, with prices having huge swings. I wonder, what are the implications of that.
  - ksec 3y ago
    And may be this is less insane if interest rate were still zero. But we are now at ~4%. And the market doesn’t seems to be taking these into account.
noisycarlos 3y ago
Well at least they're the ones selling the shovels

3 ms·

It's absolutely insane. By historical standards, we're in the Dot-com bubble territory already. This is now a 1T$ valued business, based on ... 20B$ annual rev

by TheAlchemist 3y ago

cvccvroomvroom 3y ago
Meta is spending 20 B / yr on mostly Nvidia-powered servers. Doing so without a product strategy to utilize them.
what_ever 3y ago
Not saying anything about the valuation but they just provided a guidance of $11B revenue for the next quarter which is about 50% more compared to the quarter they just reported for...
- TheAlchemist 3y ago
  Yeah, but let's more than double that - and say they make $100B of revenue per year. That's still a Price / Sales ratio of 10 ! Price to sales, not price to earnings !!! You never know, maybe this AI thing is not just hype (I think it is for now), and maybe NVidia will basically own the future of AI computing chips - if that's the case, then okay - this valuation will be OK - but this valuation is here, now ! And a huge company stock price is moving by 20-30%. This is absolutely bonkers. Know, a lot of financial reporting happens on periodical basis (be it end of day or month) - it kind of assumes that things are not moving too wildly and you can put some trust in it. Which is usually the case for big companies. But lately, we see those top N companies in US, with prices having huge swings. I wonder, what are the implications of that.
  - ksec 3y ago
    And may be this is less insane if interest rate were still zero. But we are now at ~4%. And the market doesn’t seems to be taking these into account.
noisycarlos 3y ago
Well at least they're the ones selling the shovels