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1/ After working on SaaS stocks for a several weeks, a few things are clear:
- YoY rev growth in 2018 was spectacular
- While many burn cash, they have very long runways
- BUT % rev growth will slow for many in 2019 and for most in 2020 based on company guidance
#SaaSmageddon
- YoY rev growth in 2018 was spectacular
- While many burn cash, they have very long runways
- BUT % rev growth will slow for many in 2019 and for most in 2020 based on company guidance
#SaaSmageddon
2/ SaaS stocks:
- SaaS stocks especially once you get past the top few are at extremely high multiples even of 2020 revs.
- Slight beats or misses hit SaaS stocks hard, but many have rebounded (eg $TWLO)
- Investor favor for these stocks shows no sign of cracking
- SaaS stocks especially once you get past the top few are at extremely high multiples even of 2020 revs.
- Slight beats or misses hit SaaS stocks hard, but many have rebounded (eg $TWLO)
- Investor favor for these stocks shows no sign of cracking
3/ SaaS:
- Because of market sentiment, it seems too early to short SaaS stocks
- Might not be too early to begin selling calls across a basket of SaaS and related stocks (obv risky)
- Expect a heavy hit to many of these stocks later in 2019, as growth begins to slow
- Because of market sentiment, it seems too early to short SaaS stocks
- Might not be too early to begin selling calls across a basket of SaaS and related stocks (obv risky)
- Expect a heavy hit to many of these stocks later in 2019, as growth begins to slow
