Ann: Hyperfish recurring revenue up 425% since acquisition, page-47

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richardz

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28/06/19

12:47

Post #: 39286933
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Originally posted by gdaymate ↑

Easy in hindsight to talk about opportunity cost. With experience, you'll see that chasing past winners often leads to under performing companies you think will grow and are under appreciated in the long run. If you believe in your own valuation metrics (I also believe in the 10-15x ARR for SaaS, it has been shown many times) there is no reason why in the longrun, you will not be correct. The market is not stupid, the market may be thinking the exact same as you are and stopping entering purely because if volatility and lack of yearly gains. But you look at last three years and livetiles has significantly outperformed the market. You also look at similar stocks like PPH, and XRO and you see both of them actually don't just go up all the time. Back when my dad started investing in XRO they were $15 after a recent downturn. Let's liken this to LVT right now. Since then they are still not profitable but they have enough performance metrics being understood by the market that they have quadrupled. Likewise, PPH have just reached profitability with ARR of over $100M. In the last year, sp hasn't done much. But in the long run, it is killing the market. You need to be patient and pick the stocks you think are undervalued. If you don't believe in managements 100M ARR prediction, then it's fair enough to sell out. But I am quite comfortable in it and remembering they continually beat their predictions, I think it isn't unreasonable to treat it as a likely outcome. The market will slowly react as information becomes more and more obvious and people who are scared of its volatility slowly go away over time.

Sure there is plenty of opportunity cost in the market, but would you really feel more comfortable holding a telstra or heck even xro after their recent gains (xro is obviously an amazing company but despite being unprofitable market has already priced in future cash flows and values of their profitability if they were to stop growth, it is becoming increasingly speculative to value imo)? I think investing is all about picking stocks when they are least appreciated he the market and holding u til they are appreciated. If you are patient with a good risk appetite i think you will find lvt is a great long-term growth stock.

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You make some good points.

LVT Price at posting: 44.0¢ Sentiment: Hold Disclosure: Held
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Ann: Hyperfish recurring revenue up 425% since acquisition, page-47

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