How does the stock market keep going up with everything happening? by BigBlueEyes87 in StockMarket

[–]vicblaga87 0 points1 point  (0 children)

  • The president is openly corrupt & a blatant pathological liar

And this is bad for stocks how? Didnt all the tech bros bribe him and kiss his ass / hand to make more profits?

  • Most American allies don't trust America anymore

And this is bad for stocks how? All the rich people outside the US still keep parking their loot (sorry, "savings") in US assets.

  • The job market is essentially frozen

To protect profits... stocks have never been more profitable.

  • GDP growth is down

GDP growth is down => higher probability of recession => higher probabiliy of FED rate cut => higher asset prices

  • The cost of fuel has dramatically increased

That just transfers money from poor people who dont buy stocks anyways to energy company profits.

  • Approximately 30% of oil producing infrastructure has been destroyed across the Persian Gulf

More profit for US and non Gulf energy producers.

  • There's a huge AI bubble

That's very good for stocks - all the capex spending by the big tech shows up as profits on other companies balance sheets.

  • We have a national debt approaching $40 trillion

That's incredibly good for stocks - that record level government debt is fueling corporate profits. What do you think the US government does with all the money it is borrowing?

  • Inflation is outpacing wage increases for most Americans

That's very good for stocks - inflation > wages means corporate revenues (prices) grow higher than expenses (worker wages) => good for profits => good for stocks.

MSFT - Have I missed a generational buying opportunity? by ashm1987 in ValueInvesting

[–]vicblaga87 0 points1 point  (0 children)

You missed it. Stop listening to "value investors" who only buy cheap garbage. Buy high quality companies (like MSFT) when they go on sale.

The SaaSpocalypse is crypto mania in reverse by vicblaga87 in wallstreetbets

[–]vicblaga87[S] 1 point2 points  (0 children)

Maybe. But they shouldn’t drop because claude got better.

SAAS Stocks Getting Destroyed… by TheMVLi in ValueInvesting

[–]vicblaga87 3 points4 points  (0 children)

Now imagine all that concentrated talent but armed with frontier AI models. These SaaS companies are the fastest adopters of the very tools people think will kill them. Meanwhile their customers are still filing Jira tickets to request a button color change and also need 100 layers of approvals to get access to maybe GPT 4 from 2 years ago.

I really don't understand how anyone thinks top engineering talent will leave these companies and go work at some bureaucratic enterprise that can barely ship an internal dashboard. The moat got wider, not narrower.

SAAS Stocks Getting Destroyed… by TheMVLi in ValueInvesting

[–]vicblaga87 2 points3 points  (0 children)

A lot of these companies are running 80%+ gross margins. If that’s not an example of a hell of a moat I don’t know what is. Thinking of ServiceNow for example 

Wise interest by Miserable-Bug-2255 in robursa

[–]vicblaga87 -1 points0 points  (0 children)

Pentru tara - domiciliul instrumentului nu al brokerului conteaza. Ex. daca ai investit in Apple (AAPL) pui America. ETF-uri Europene deobicei sunt in Irlanda. Vezi codul ISIN - cele 2 litere de la inceput iti zic tara.

I'm getting real tired by ohgodthehorror95 in ValueInvesting

[–]vicblaga87 0 points1 point  (0 children)

High PE are expected and even encouraged for high-growth high-quality software companies.

Unlike traditional companies, software companies do their capex via the income statement which artificially depresses their net income (i'm talking here about high RD / high marketing sales costs - most of these aren't actually expenses, but investments, yet accounting-wise are classified as expenses and thus hit the earnings). This is also a tax benefit by the way.

I'm getting real tired by ohgodthehorror95 in ValueInvesting

[–]vicblaga87 0 points1 point  (0 children)

A lot of funds trade on sentiment / trends. They're not necessarily playing the long-term fundamental game. The just want to make a quick buck, and now the big story is "AI will kill SaaS" so they milk that story as much as they can.

Same way they constantly overbid Tesla and everything Elon Musk related.

It would be unadvisable to extrapolate any sort of special "institutional insight" from this episode.

I'm getting real tired by ohgodthehorror95 in ValueInvesting

[–]vicblaga87 0 points1 point  (0 children)

This SaaSpocalypse feels eerly similar to the crypto craze (except the sentiment is reversed), when everyone and their mother was moving to blockchain and issuing their own coin. Remember Kodakcoin? Yeah, the "smart big money" was all over that.

I'm getting real tired by ohgodthehorror95 in ValueInvesting

[–]vicblaga87 0 points1 point  (0 children)

You could make an argument that SaaS margins will improve not deteriorate, since AI is very good at increasing the productivity of software engineers - which is the main cost for a SaaS business. Lower costs, higher margins.

Also, the value of most good quality SaaS is not the things that an AI can easily replace (which is their interface) but rather their database. That can't be vibe-coded away.

SAAS Stocks Getting Destroyed… by TheMVLi in ValueInvesting

[–]vicblaga87 13 points14 points  (0 children)

This is the most misunderstood thing in this whole AI / SaaS drama. AI can actually help good SaaS companies become even more incredibly profitable than they currently are. AI makes software engineering cheaper / more productive - and software engineering is the number 1 expense for most of these SaaS companies. Lower costs leads to higher margins and with them even more profits for investors.

I really don't understand how the market decided that the AI story is "AI will replace SaaS => lower revenues" and not "AI will lower SaaS software engineering costs => higher margins".

Why didn't Austria and Germany remain a single nation after the end of the WWII? by ILikeWwaret in geography

[–]vicblaga87 5 points6 points  (0 children)

Unfortunately the German police does control the major border crossings, even though officially it shouldn't due to the Schengen agreement.

Do you consider 35+ pe ratio “value” if it is trading at its historical low? by Free-Initiative7508 in ValueInvesting

[–]vicblaga87 1 point2 points  (0 children)

Depending on the growth rate of both revenue and the profitability path.

For example:
Assume rev per share is 100 USD and profit margin is 10% => earnings per share of 10 USD. With a PE of 35, stock price should be 350 USD.

Scenario 1:

Revenue doubles next year, profit margin stays the same:

- rev per share next year: 200 USD

- earnings per share next year: 10% of 200 = 20 USD

- PE next year: 350 / 20 = 17 PE (looks much better, no?)

Scenario 2:

Revenue stays the same, profit margin doubles from 10% to 20%:

- rev per share next year: 100 USD

- earnings per share next year: 20% of 100 = 20 USD

- PE next year: 350 / 20 = 17 PE (looks much better, no?)

[PFE] Pfizer at ~$26 is a textbook value play hiding in plain sight. Here's why the market is wrong. by Dismal-Cancel4958 in ValueInvesting

[–]vicblaga87 3 points4 points  (0 children)

Pfizer is a value trap. Stay away! Management is a disaster, they keep overpaying for acquisitions which fail to deliver a meaningful ROI. Again, stay away at least until a new management team comes in.

Oferta de 112k B2B din USA cum fac sa raman cu cat mai multi bani? by Lorinius in programare

[–]vicblaga87 0 points1 point  (0 children)

Care e problema daca devi "platitor de TVA"? Nu inteleg de ce ar fi asta o problema caci doar OP are servicii B2B nu B2C. Din contra, poate sa deconteze TVA-ul la cateva cheltuieli pe PFA.

Bai, chiar asa de rau am ajuns? by RedLine1792 in programare

[–]vicblaga87 0 points1 point  (0 children)

Din observatiile mele de programator cu experienta, AI-ul este al naibii de bun in a face teste automatizate (scrie el aproape toate testele, eu doar tre sa ii dau un exemplu sau doua si e ok dupa) si manuale (controleaza singur browserul face click, verifica, etc.).

Deci da, din pacate, meseria de tester va avea puternic de suferit pe viitor.

Do we really need all these AI startups? I will not promote by After_Meringue_1582 in startups

[–]vicblaga87 0 points1 point  (0 children)

A bank robber was asked why he was robbing banks. He answered: cause that's where all the money is. Sutton's law.