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No. of Recommendations: 9
I appreciate your analysis. It gives a good way to think about very high growth stocks, but also works for more traditional companies. Basically saying, how much does this company have to grow for the next 5 years for today's price to make sense? Or, if the company grows at "x" rate for the next 5 years and has "y" valuation at that point in time, what kind of return does that imply?

Interesting that you picked CRWD, as I had just sold it the day before your OP. I'll probably regret it, but I struggle to hold stocks when I feel like the price has gotten too far ahead of the business.

Personally, my belief about CRWD, TSLA, and several other highly valued companies right now is that too much of that future growth is already baked into the price. So, CRWD has to grow FCF by ~50% every year for the next 5 years in order to have the kind of multiple that MSFT has now? That's a really high growth rate for a long time.

Last year being a prime example, we have no idea what is coming down the pipe. If the Fed's money spigot dries up, valuations could tumble. CRWD might be doing great as a business, but the multiple could get cut in half.

Again, thank you for sharing your insight. I'm not refuting it. Just saying that in my personal situation, I looked at the same numbers and came to a different conclusion.

sf--no longer seeking so much alpha
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