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Tsachy Mishal
My 2 cents on this value vs. growth debate. Something has changed but value is not dead 1/n
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Tsachy Mishal Oct 31
Replying to @CapitalObserver
Something changed with the internet. The internet is winner take all. There are 50 brands of beer but there is one Google 2/n
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Tsachy Mishal Oct 31
Replying to @CapitalObserver
In the past if there was a profitable business many would enter & there would be many winners & mean reversion between the competitors 3/n
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Tsachy Mishal Oct 31
Replying to @CapitalObserver
Now there is one winner and many losers. See Amazon versus the graveyard of retailers 4/n
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Tsachy Mishal Oct 31
Replying to @CapitalObserver
In order to find value in this environment one must find something cheap & with no secular threats. Statistically cheap won't do it 5/n
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tomandprisha Oct 31
Nifty Fifty of old now Sexy 600 beat Ugly 8000
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GT Oct 31
Replying to @CapitalObserver
So, you're actually saying that "This time is different", right?
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Tsachy Mishal Oct 31
Replying to @CapitalObserver
These companies that are being secularly destroyed by the internet end up in the value sector while the growth winners keep winning 6/n
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Erik Pupo Oct 31
Replying to @CapitalObserver
The problem is the market keeps rewarding growth at any cost over profitability - its gives Amazon the size to destroy everything
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Tsachy Mishal Oct 31
Replying to @CapitalObserver
It's not in my DNA to just pay up & ride the growth wave but I do realize that something has changed 7/n
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Erik Pupo Oct 31
Replying to @CapitalObserver
And then people wonder why there is no inflation - its hard to drive up prices when someone can come into your mkt losing inf. amounts of $
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Tsachy Mishal Oct 31
Replying to @CapitalObserver
Value can still work. It's just a lot trickier. The most important thing is to avoid the secular decliners 8/n
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Gavin Parks Oct 31
Replying to @CapitalObserver
I guess radio companies were value at some point too
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Gavin Parks Oct 31
Replying to @CapitalObserver
well said
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Tsachy Mishal Oct 31
Replying to @CapitalObserver
One last thing. I disagree with Einhorn that this is 1999. There's mostly sound reasoning behind growth beating value the past few years 9/9
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NeckarCap Oct 31
Replying to @CapitalObserver
the 1999 is happening in the excess of VC copycat funding, perhaps crypto; not in momentum of the tech winners
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Emilgold Oct 31
Replying to @CapitalObserver
I strongly disagree, nothing fundamentally changed. Value is everywhere, just not on p/e
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alphagen Oct 31
Replying to @CapitalObserver
I'd add - value is doing fine, if value = DCF and not P/B, P/E, etc.
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East Coast Asia Oct 31
Replying to @CapitalObserver
Great insights
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Tsachy Mishal Oct 31
Replying to @eastcoastasia
thanks
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