Quote:
Originally Posted by bizaro86
Yep. Right now they're growing fast enough to justify their valuation.
The problem is they can't grow at that pace forever, because they'd become 100% of the world economy. And while AI chips are cool, people are probably going to want food and shelter too.
But predicting when that growth plateaus or even reverses is very difficult. Semis have a history of being a cyclical industry, and it seems likely to me that this boom period will with buyers having more inventory than they need, so a de-stocking period will likely occur.
If they have revenue declines and the market re-rates their multiple because of it the losses will be huge. But there's no evidence at all of that happening soon (except maybe timelines to get product coming down) so if they keep growing at this pace for another few years the returns in that time period could be massive.
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Momma's lump sum buy from maybe 2 years ago is up about 500%. I say sell, she will definitely hold. Lol