Market's split in two right now.
One half: bloated valuations completely disconnected from any reasonable cash flow projection. Pure narrative, no earnings to back it up.
Other half: solid cash-generating businesses trading at multiples we haven't seen since 2012-2015. Real companies, real profits, absurdly cheap.
Days like this feel like the market slowly waking up to that gap. Mean reversion doesn't happen overnight, but it always happens. The question isn't if—it's when, and how painful the adjustment gets for those holding the expensive side.
Valuation always wins in the end. Always.
One half: bloated valuations completely disconnected from any reasonable cash flow projection. Pure narrative, no earnings to back it up.
Other half: solid cash-generating businesses trading at multiples we haven't seen since 2012-2015. Real companies, real profits, absurdly cheap.
Days like this feel like the market slowly waking up to that gap. Mean reversion doesn't happen overnight, but it always happens. The question isn't if—it's when, and how painful the adjustment gets for those holding the expensive side.
Valuation always wins in the end. Always.