Dear 007,
Thanks for posting.
Interesting question.
Busy day here, but I will take a short break to address your question.
Look – everyone is entitled to their view and to analyze companies by which ever metrics they choose.
I, for one, do not value companies using the metrics the gentleman you quoted, and I believe I have had a lot more success at investing in companies than he has.
I think it is generally a dangerous thing to value companies off of past revenues vs market cap, particularly those that are into game changing technologies…for obvious reasons. The past may not be a very good predictor of the future… actually you are hoping it isn’t…isn’t that why you are investing in game changing companies in the first place?
I generally believe if you are trying to drive a car looking in the rearview mirror you will crash and burn, which is effectively what he is doing.
In order to drive a car, particularly at fast speeds, you must forward forward…I believe there is no other option.
Personally, that’s where I put all my efforts. All forward looking…I look at the future fundamentals and really do not care about the past. I look at the balance sheet, cash on hand, and debt position as well as future cash flow (in terms of booked contracts and in the money options/warrants). I do not give much value to published pipeline as that can easily be manipulated and I find it a bit sketchy if a company quotes it.
I do a deep dive into the fundamentals of the company and the probability of it being a game changer. I look at its place in the industry, its partners, management, etc. etc.
But that’s me, and I believe that’s the way top tier fund managers like Cathie Wood does it as well…
So to answer your question:
What would you prefer, driving a car looking through the rearview mirror like Peter Hodson
Or deep dive fundamental analysis like Cathie Wood?
Peter Hudson?
Or
Cathie Wood?
Peter Hudson?
Or
Cathie Wood?
Peter Hudson?
Or
Cathie Wood?
I leave it up to you.
Hope that Helps
Peter