Stock just posted 100%+ revenue growth for fiscal 2024 and guided for another 80-100% growth in 2025. Margins contracted slightly, though the CEO had already mentioned multiple times this year that margins were going to fall as they looked to rapidly grow revenue and market share. He’s also guided for margins to steadily tick back up in the coming quarters.
The stock cratered 18% this morning and is down 55% from highs. They’re now sitting at a PE of 24, and forward PE of 15.
I hold a few shares, but am truly scratching my head at this valuation and debating about buying a bunch more shares or some LEAPs. They’re a well run, fast growing company with low debt and healthy margins. In an industry that’s expected to grow at a double digit CAGR for the foreseeable future.
Do people expect margins to keep falling? Or revenue to start declining in the next year? I don’t see how else you’d have a company that’s doubling its revenue YoY trading at such a ridiculously cheap valuation with such sound fundamentals.
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