David Einhorn States The Obvious About Big Tech
David Einhorn used to be a man of great wisdom. An investor who was always playing chess while we all were stuck playing checkers. Now, he’s just stating what we all know.
In a quarterly letter to investors, Einhorn spoke to great lengths about how tech stocks are in the midst of a giant bubble. To which the response is… uhhhhh ya think. Sure, there’s a greater need for technology than ever with so many people stuck at home. However, is Zoom really worth over $150 billion and $500 a share on revenues of just over a billion dollars? Is Snowflake really worth over $70 billion and $260 a share on revenues of half a billion in addition to operating losses of over $300 million. No. No, they’re not.
It shouldn’t take a genius to realize that tech companies today are incredibly overvalued. Yes, these companies have a greater need in society but they’ve pushed way too high thanks to an increased appetite for investing around the world and way too much hype. What happened to the good ol’ days when Einhorn was exposing Allied Financial and Lehman Brothers? Those were the true works of art. Now, he’s just getting lazy. What’s next? Retail companies that don’t have a large e-commerce presence are in trouble? Be wary of oil companies actually doing well?
Come on Einhorn, we all expect better from you.