No. of Recommendations: 1
in the past, the stock has tended to overshoot. After a period of high valuation, the slide has on averaged continued right on down past the typical valuation range into the cheap range, often very cheap.This raised my curiosity so I updated my version of Jim´s chart of "Price / smoothed Peak BV":
Google: File D 1flfn7xrCqY b0jOidnJDpjaKVb51u5CsAccording to that
- It´s price moves around the yellow line, in a channel of "1.2-1.55x smoothed PeakBV"
- Since 2005 (I don´t count that before) it deviated only 4x a lot upwards from the yellow line and reached or broke through the upper border of this channel: 2007/8, 2014/15, 2021/22, 2024/25
- Each of the previous 3x within 1 year (2008 and 2015) or 1/2 year (in 2022) it overshoot it´s typical line and continued to slide down to the lower border or (2009) even lower
- What happens the 4th time (Now!) remains to be seen, but from this history it doesn´t seem unlikely that it may (again) continue it´s slide down to 1.2 x smoothed PeakBV
- Or maybe even lower, as in 2009? The peak before was the only one from which it went not just straight down (as in 2015 and 2022), but held that very high valuation for a long time --- like now! And then it "crashed" completely