Biotech2k
Biotech Investor, AI-Driven Drug Discovery
Combining estimated NTM revenue growth with trailing GAAP EBITDA margin makes Palo Alto Networks, Datadog, JFrog, Rubrik and Snowflake look overvalued against forward EV/sales. Zoom, Alphabet, Oracle, AppLovin, Microsoft, Fair Isaac, Adobe, Amazon and Teradata remain undervalued on this Rule of 40 comparison; Palantir, Cloudflare and CrowdStrike remain overvalued. x.comÂ
Stocks with very high price-to-sales ratios, such as SpaceX, Snowflake, Palantir and Trump Media, are worth avoiding because higher price-to-sales has historically led to lower returns. Their annualized ratios are about 64.5, 20, 56.5 and 400. Growth investors are better served by Micron over SpaceX, Salesforce over Trump Media, Nvidia over Palantir and Alphabet over Snowflake. These companies' innovation is impressive, but valuation matters. x.com x.comÂ
Most rivals cannot match these 12 stocks' moats. Micron is one of three HBM titans; Circle backs USDC; ASML alone makes EUV; Planet Labs has the largest Earth-imaging fleet. MongoDB is developers' choice; Affirm embeds at Amazon and Shopify; Eli Lilly leads GLP-1; SoFi spans loans, banking and investing. On gains via CloudTec; AST SpaceMobile builds phone satellites; Rigetti offers cloud quantum computing; Spotify, the largest music streamer, adds podcasts and audiobooks. x.com x.com x.com x.com … Show more
Snowflake's valuation looks full after more than doubling since May on an AI inflection story, given five years of promised inflections that didn't materialize. Stock-based compensation remains heavy at $1.6B against FY2026 revenue of $4.7B, though dilution has been kept in check lately. At about 23x EV/revenue, or 19x forward, it sits near the top of its 2-3 year range. A Databricks IPO could make investors see Snowflake as old relic tech. x.com x.comÂ
Rubrik is in a dangerous place, one deceleration away from growth in the 20s while still sub-scale. Palantir is a better company at a much better multiple and is accelerating while sustaining triple-digit growth. Rubrik would be worth a solid bet in the $60s or $70s, but on current fundamentals it shouldn't be more than a 5% position. x.comÂ
Snowflake and Oracle join the software names that, at decade lows, can rise at least 2-3x before retirement. The dot-com toppers are the precedent: chip, interconnect, optics and memory names fell 90-95% after 2000 and still came back 1,000-2,000% over 26 years. They now sit beside ServiceNow, Atlassian, Salesforce, Microsoft, Figma, Workday and The Trade Desk, preferred over chasing AI names. @TheShortBear notes investors are capitulating into AI as cheaper stocks keep getting cheaper. x.comÂ
Snowflake is still not GAAP profitable at a $125 billion valuation because it keeps chasing top-line growth at any cost. x.comÂ
Rubrik, Zscaler and Microsoft look very bearish: their reliance on cheap H-1B labor leaves their P&Ls exposed, and those P&Ls are expected to worsen. x.comÂ
Customers apparently aren't vibe coding their way off Snowflake, which makes the stock easy money. x.comÂ
MongoDB is an easy funding short because of its high multiple and a squishy last quarter, regardless of long-term fundamentals; in this tape, anything short of a clean beat is squishy. A post the author replies to argues Atlas grew 29% against expectations of 30%, roughly in line after adjusting for a large hybrid contract. x.com x.comÂ