Avoid Buying Palunteer at Its Extreme Valuation

about 1 month ago

Joseph Carlson

"When I look at Palunteer, there are two different stories going on. One of the stories is that this company is just amazing. The revenue growth is absolutely insane and it's driven by strong volume of customers. But then there's the valuation – a price-to-sales forward multiple of about 90 and a market cap over 400 billion. Even though I think it's going to beat on its revenue and its earnings, it's not one that I'm interested in jumping in now at this valuation."

The speaker highlights Palunteer's impressive growth fundamentals but warns that its astronomical valuation leaves little room for error. He explicitly avoids buying the stock at current levels due to its extreme pricing, making it a risky proposition if growth were to decelerate.

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