It seems odd to me that the overwhelming sentiment a year ago was bullish on high growth tech, and now that valuations have come down to reasonable levels, everyone thinks they’re going to crash even harder?
This is an incredible buying opportunity in many of these names. Take Sea Limited for example. It’s trading at about 8.7x sales, or roughly ~5x forward sales. That’s quite cheap for a company that has doubled revenue each of the past two years, is aggressively expanding, and is projecting profitability in just two years.
Rate hikes are not doomsday for a company like Sea, they have tons of cash and it’s not like rates are going to 15%. Borrowing at 2-3% is still cheap.
The absolute best buys in the market right now are high quality, high growth stocks. They offer outsized upside at good prices. This is a once in a blue moon opportunity.
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