Sergey
@sergeycyw.bsky.social
I talk about growth stock investing and fundamental analysis with a long-term mindset. I provide earnings reviews and key news updates. Not investment advice.
SergeyCYW.substack.com
SergeyCYW.substack.com
The chart includes the most popular stocks: $CRWD $PLTR $NET $RBRK $SHOP $ZS $SNOW $NOW $AXON $PANW $DUOL $MSFT $AMZN $GOOGL $APP $ORCL.
December 21, 2025 at 2:26 PM
The chart includes the most popular stocks: $CRWD $PLTR $NET $RBRK $SHOP $ZS $SNOW $NOW $AXON $PANW $DUOL $MSFT $AMZN $GOOGL $APP $ORCL.
On the chart, companies with a Rule 40 score <30% are marked in red, those <40% in yellow, and those >40% in green.
*-Selection criteria: software companies with the majority of their revenue subscription-based, EV over $1 billion, and a gross margin above 40%.
*-Selection criteria: software companies with the majority of their revenue subscription-based, EV over $1 billion, and a gross margin above 40%.
December 21, 2025 at 2:26 PM
On the chart, companies with a Rule 40 score <30% are marked in red, those <40% in yellow, and those >40% in green.
*-Selection criteria: software companies with the majority of their revenue subscription-based, EV over $1 billion, and a gross margin above 40%.
*-Selection criteria: software companies with the majority of their revenue subscription-based, EV over $1 billion, and a gross margin above 40%.
In this case, I used the GAAP EBITDA Margin TTM combined with revenue growth estimates for the next year.
The Rule of 40 allows for the comparison of companies at different stages and scales.
The Rule of 40 allows for the comparison of companies at different stages and scales.
December 21, 2025 at 2:26 PM
In this case, I used the GAAP EBITDA Margin TTM combined with revenue growth estimates for the next year.
The Rule of 40 allows for the comparison of companies at different stages and scales.
The Rule of 40 allows for the comparison of companies at different stages and scales.
A company that meets or exceeds the 40% threshold is generally considered to be performing well, making it potentially more attractive to investors looking for balanced growth and profitability.
December 21, 2025 at 2:26 PM
A company that meets or exceeds the 40% threshold is generally considered to be performing well, making it potentially more attractive to investors looking for balanced growth and profitability.
The PSG ratio is instrumental in determining whether a high P/S ratio is justified based on the company’s actual growth trajectory.
The chart includes the most popular stocks: $CRWD $PLTR $NET $RBRK $SHOP $ZS $SNOW $NOW $AXON $PANW $FIG $DUOL $MSFT $AMZN $GOOGL $APP $ORCL.
The chart includes the most popular stocks: $CRWD $PLTR $NET $RBRK $SHOP $ZS $SNOW $NOW $AXON $PANW $FIG $DUOL $MSFT $AMZN $GOOGL $APP $ORCL.
December 21, 2025 at 12:31 PM
The PSG ratio is instrumental in determining whether a high P/S ratio is justified based on the company’s actual growth trajectory.
The chart includes the most popular stocks: $CRWD $PLTR $NET $RBRK $SHOP $ZS $SNOW $NOW $AXON $PANW $FIG $DUOL $MSFT $AMZN $GOOGL $APP $ORCL.
The chart includes the most popular stocks: $CRWD $PLTR $NET $RBRK $SHOP $ZS $SNOW $NOW $AXON $PANW $FIG $DUOL $MSFT $AMZN $GOOGL $APP $ORCL.
This metric is particularly relevant in the software industry, where companies often command high P/S ratios driven by expectations of rapid growth from scalable operations.
December 21, 2025 at 12:31 PM
This metric is particularly relevant in the software industry, where companies often command high P/S ratios driven by expectations of rapid growth from scalable operations.
*-Selection criteria: software companies with the majority of their revenue subscription-based, EV over $1 billion.
The chart includes the most popular stocks: $CRWD $PLTR $NET $RBRK $ZS $SNOW $MDB $NOW $AXON $PANW $DUOL $APP.
The chart includes the most popular stocks: $CRWD $PLTR $NET $RBRK $ZS $SNOW $MDB $NOW $AXON $PANW $DUOL $APP.
December 20, 2025 at 4:07 PM
*-Selection criteria: software companies with the majority of their revenue subscription-based, EV over $1 billion.
The chart includes the most popular stocks: $CRWD $PLTR $NET $RBRK $ZS $SNOW $MDB $NOW $AXON $PANW $DUOL $APP.
The chart includes the most popular stocks: $CRWD $PLTR $NET $RBRK $ZS $SNOW $MDB $NOW $AXON $PANW $DUOL $APP.
The real value of this framework lies in challenging consensus. The objective is not to accept forecasts at face value, but to use the relationship between forward P/E and implied growth as a sanity check on where the market may be misjudging the durability and quality of SaaS growth.
December 20, 2025 at 4:07 PM
The real value of this framework lies in challenging consensus. The objective is not to accept forecasts at face value, but to use the relationship between forward P/E and implied growth as a sanity check on where the market may be misjudging the durability and quality of SaaS growth.
This approach shifts the focus away from absolute multiples and toward how much investors are paying for each unit of expected growth.
December 20, 2025 at 4:07 PM
This approach shifts the focus away from absolute multiples and toward how much investors are paying for each unit of expected growth.
Normalizing valuation multiples by expected growth helps highlight situations where the market may be underpricing or overpricing incremental growth relative to peers and historical patterns.
December 20, 2025 at 4:07 PM
Normalizing valuation multiples by expected growth helps highlight situations where the market may be underpricing or overpricing incremental growth relative to peers and historical patterns.
P.S. To make the data on the chart easier to read, I removed $PLTR, which is trading at 141.9 Forward EV/GP and +46% Est Growth Rate.
December 20, 2025 at 2:28 PM
P.S. To make the data on the chart easier to read, I removed $PLTR, which is trading at 141.9 Forward EV/GP and +46% Est Growth Rate.
*-Selection criteria: software companies with the majority of their revenue subscription-based, EV over $1 billion, and a gross margin above 40%.
The chart includes the most popular stocks: $CRWD $PLTR $NET $RBRK $SHOP $ZS $SNOW $NOW $AXON $PANW $FIG $DUOL $MSFT $AMZN $GOOGL $APP $ORCL.
The chart includes the most popular stocks: $CRWD $PLTR $NET $RBRK $SHOP $ZS $SNOW $NOW $AXON $PANW $FIG $DUOL $MSFT $AMZN $GOOGL $APP $ORCL.
December 20, 2025 at 2:28 PM
*-Selection criteria: software companies with the majority of their revenue subscription-based, EV over $1 billion, and a gross margin above 40%.
The chart includes the most popular stocks: $CRWD $PLTR $NET $RBRK $SHOP $ZS $SNOW $NOW $AXON $PANW $FIG $DUOL $MSFT $AMZN $GOOGL $APP $ORCL.
The chart includes the most popular stocks: $CRWD $PLTR $NET $RBRK $SHOP $ZS $SNOW $NOW $AXON $PANW $FIG $DUOL $MSFT $AMZN $GOOGL $APP $ORCL.
In this case, I used the GAAP Operating Margin from the most recent quarter. It helps identify the latest trends and highlights companies that have recently achieved operating profitability. However, for companies affected by seasonality, the data may be distorted.
December 20, 2025 at 2:28 PM
In this case, I used the GAAP Operating Margin from the most recent quarter. It helps identify the latest trends and highlights companies that have recently achieved operating profitability. However, for companies affected by seasonality, the data may be distorted.
On the chart, companies with a negative operating margin are marked in red, those with an operating margin below 5% in yellow, and those with an operating margin above 5% in green.
December 20, 2025 at 2:28 PM
On the chart, companies with a negative operating margin are marked in red, those with an operating margin below 5% in yellow, and those with an operating margin above 5% in green.
I also include data on Operating Margin in the chart, as it impacts company valuation. Companies with a high positive operating margin should be valued higher than those with a negative operating margin.
December 20, 2025 at 2:28 PM
I also include data on Operating Margin in the chart, as it impacts company valuation. Companies with a high positive operating margin should be valued higher than those with a negative operating margin.
This multiple considers product efficiency—gross profit margin. Gross profit margin is a critical metric for software companies. Consistently high or improving margins are often viewed as indicators of a company's strong competitive position and market potential.
December 20, 2025 at 2:28 PM
This multiple considers product efficiency—gross profit margin. Gross profit margin is a critical metric for software companies. Consistently high or improving margins are often viewed as indicators of a company's strong competitive position and market potential.
P.S. To make the data on the chart easier to read, I removed $PLTR, which is trading at 79.9 Forward EV/Sales and +46% Est Growth Rate.
December 20, 2025 at 12:31 PM
P.S. To make the data on the chart easier to read, I removed $PLTR, which is trading at 79.9 Forward EV/Sales and +46% Est Growth Rate.
*-Selection criteria: software companies with the majority of their revenue subscription-based, EV over $1 billion, and a gross margin above 70%.
The chart includes the most popular stocks: $CRWD $PLTR $NET $RBRK $ZS $SNOW $MDB $NOW $AXON $PANW $DUOL $APP $FIG $ADBE $CRM.
The chart includes the most popular stocks: $CRWD $PLTR $NET $RBRK $ZS $SNOW $MDB $NOW $AXON $PANW $DUOL $APP $FIG $ADBE $CRM.
December 20, 2025 at 12:31 PM
*-Selection criteria: software companies with the majority of their revenue subscription-based, EV over $1 billion, and a gross margin above 70%.
The chart includes the most popular stocks: $CRWD $PLTR $NET $RBRK $ZS $SNOW $MDB $NOW $AXON $PANW $DUOL $APP $FIG $ADBE $CRM.
The chart includes the most popular stocks: $CRWD $PLTR $NET $RBRK $ZS $SNOW $MDB $NOW $AXON $PANW $DUOL $APP $FIG $ADBE $CRM.
In this case, I used the GAAP Operating Margin from the most recent quarter. It helps identify the latest trends and highlights companies that have recently achieved operating profitability. However, for companies affected by seasonality, the data may be distorted.
December 20, 2025 at 12:31 PM
In this case, I used the GAAP Operating Margin from the most recent quarter. It helps identify the latest trends and highlights companies that have recently achieved operating profitability. However, for companies affected by seasonality, the data may be distorted.
On the chart, companies with a negative operating margin are marked in red, those with an operating margin below 5% in yellow, and those with an operating margin above 5% in green.
December 20, 2025 at 12:31 PM
On the chart, companies with a negative operating margin are marked in red, those with an operating margin below 5% in yellow, and those with an operating margin above 5% in green.