No qualifying author-owned investment thesis was confirmed in this post.
General sector observation without a specific actionable asset or trade; no identifiable ticker-level thesis.
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Here is what I don’t get.
On one hand, the SaaS companies are getting clobbered because the belief is the products they are offering is going to be taken over by AI and the companies future EPS/PE are on shaky footing (e.g. CRM, Adobe, SAP, Figma, the list can go on etc.). Market thesis: Enterprise AI adoption is expected to be real risk for SaaS companies and enterprises will monetize AI and significantly reduce revenues or costs associated with these companies. If the AI risk is not real, these companies should have longer runway to survive vs. immediate sell-offs.
On the other hand, companies with solid cash flow earnings and on the forefront of AI infrastructure build (Hyperscalers, chip designers, chip manufacturers etc.) that will make the AI adoption a reality are getting hit because they are re-investing their cash flows to invested in his future growth (Capex by Amazon, Google, Meta, Microsoft etc.). Market thesis - worried enterprise AI adoption may not pan out and Capex spend will not realize value.
Thoughts on above? Where market is today and will head in the near term / long term would be largely dependent on whether AI adoption thesis will materialize.