There is a case to be made that LLM spending is going to raise capex and consequently hit net margins. So, other things being equal, the "normal" or fair price-to-sales ratio would be expected to fall a bit. Yet price to trailing sales ratio is (literally in my case of my Excel sheet) off the chart at 11.7.

Great firm, but a fella has to ask, is the pricing starting to seem rich enough that the odds favour lightening now and waiting for a better re-entry?


I sold most of my position recently for valuation reasons. Today I just wrote ATM $345 calls against much of the rest turning it mostly into a covered call position. Purely the solution for the wishy-washy who can't decide whether to sell or not. If exercised the exit price is $398 and change, 13.6 times current trailing sales. (sales will presumably be higher by the time the options mature). Good returns have historically followed entries under 6 times sales. 13.6 is bigger than 6.

Admittedly also coloured a bit by the fact that, generally speaking, I'm slowly winding down my last few remaining US positions. Capital including cash is now predominantly in UK, Canada, Europe.

The market is roaring and I don't think we are at a market top. But hey, when the market offers you a really great price for something, it pays to at least think twice before turning down the offer.

Jim