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Feb 17
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AVOID
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u/Yaashicca
Reddit u/Yaashicca, r/ValueInvesting
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The potential for AI agents to disrupt the core seat-based SaaS business model warrants avoiding the broader software sector until the impact of this disruption becomes clearer. The Nasdaq is down 5 weeks in a row, software stocks are down 20-50%, and the author highlights the bear case of AI agents disrupting the SaaS pricing model. This isn't just a valuation reset but a potential business model threat, suggesting fundamental risks that outweigh current multiple compression for many companies in the sector. It may be prudent to avoid the entire software sector until there is more clarity on how the AI disruption will play out and which business models will adapt or fail. Missing out on a potential rebound if the AI disruption is overstated, takes longer to materialize, or if certain companies within the sector prove resilient and innovative in adapting to AI. |
Reddit — r/ValueInvesting
The Nasdaq is down 5 weeks in a row. Software...
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