@noomxx i think your strategy is better described as "buying company that the market has severely mispriced". because in the current interest rate environment, those extremely expensive growth stocks are simply fully valued not because market is willing to pay their kidneys for it. if xero's growth rate is more than expected it'll become even more expensive, maybe $200. ofc the likes of afterpay is just a bubble and it went that high on momentum.
most of the very expensive tech stocks in america and australia are not in a dotcom bubble because they make money and people have confidence in their forecasted future earnings, whereas in dotcom bubble most companies were loss making, and this is a quote from experts not me. yields will drive growth stocks lower ofc.
why would you buy a company you believe is just fair priced? it goes against your "abnormal return" thesis. if you think appen is fair priced today you wouldn't even bother looking at it, obviously you think its severely underpriced if growth returns.
Appen Strategic Valuation, page-26
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