ralph

Concerning Investments, Speculations, and Unsolicited Advice. l/s equity. former ss research

[ralph @_Ayther_]

What Really Matters in Stock Valuation

This thread will explain how I think about company valuation. I’m hoping it will be useful to investors at all levels of experience, since I think there’s some unique stuff in here.

https://t.co/0o8plkVsiI

[ralph @_Ayther_]

@puppyeh1 Agree w all of this

[ralph @_Ayther_]

@viggy_krishnan @rev_cap … lol right? Like. They know how much it costs and they know approx revenue at target utilization. They’re going to hit target utilization.

[ralph @_Ayther_]

@SouthernValue95 Good framing. I think this market dynamic will change soon, memory peaky here

[ralph @_Ayther_]

@rubicon59 they are going to make a lot of money and amazon was already developing chips for cloud compute

[ralph @_Ayther_]

@WaterworldCapi1 @rev_cap memory is trading as if margins don't normalize (ever). I agree there will be a shortage for many more years and still find holding some. But they're trading assuming MU 30%+ ebit margin terminal imo

[ralph @_Ayther_]

@WaterworldCapi1 @rev_cap Thanks for flagging, I think memory is extended here anyway. Going to take some risk off there and find somewhere else to put it. At least intel, tsm

[ralph @_Ayther_]

@rev_cap Not really sure why he is being such a doomer around our ability to adapt. It may be the right view but far from certain

[ralph @_Ayther_]

@rev_cap It's actually really interesting because he's right about the disruption but can't imagine that jobs will change around it

[ralph @_Ayther_]

@BeenThereCap yikes

[Ben Carlson @awealthofcs]

In 2017 I wrote about all of the wrong tech bubble predictions

Pretty crazy it's still going on almost a decade later

[ralph @_Ayther_]

@rubicon59 I've increasingly liked the idea that the QQQ index board are the best investors of all time. like that might actually be true

[ralph @_Ayther_]

@viggy_krishnan @MetacriticCap I reject the premise that AI makes people feel bad but agree that Dario is coming from a place of scientific rigor and talks frankly about what he really thinks

[ralph @_Ayther_]

@BeenThereCap Would be amazing for Amazon

[ralph @_Ayther_]

@ChairliftCap Yes legitimately everyone should try to work at companies that are creating massive value

[ralph @_Ayther_]

@BeenThereCap Why not give Elon more capital. Legitimate question. This is the purpose of capital markets

He should have as much capital as he realistically needs

It would be cheap if your thesis plays out, its not an unreasonable thesis

[ralph @_Ayther_]

@RihardJarc There will be an insane amount of work for highest intelligence models until all reasonable physical human problems are solved

[ralph @_Ayther_]

@atelicinvest There are obviously major possible improvements to models. They can hardly learn on the fly relative to humans (or if they can they don’t remember it)

Continual learning. Someone will figure it out. Won’t require less memory and compute

[ralph @_Ayther_]

@ChairliftCap It's probably just shift to pods. In the short term DCFs matter less and sentiment (multiples) matter more. Nature of pods unfortunately

[ralph @_Ayther_]

@rubicon59 NVDA agree. MU getting expensive here imo. Requires huge growth (probably) but also margins not normalizing (unlikely). Cycle average ~18%

[ralph @_Ayther_]

mu might be getting expensive