Let’s dig into the relative performance of Microsoft (NASDAQ:MSFT) and its peers as we unravel the now-completed Q1 automation software earnings season.
Stocks trading between $10 and $50 can be particularly interesting as they frequently represent businesses that have survived their early challenges.
However, investors should remain vigilant as some may still have unproven business models, leaving them vulnerable to the ebbs and flows of the broader market.
Is it time to get cautious about pricey market darlings? These high-growth artificial intelligence (AI) stocks could be great buys -- at a lower price.
Expensive stocks typically earn their valuations through superior growth rates that other companies simply can’t match.
The flip side though is that these lofty expectations make them particularly susceptible to drawdowns when market sentiment shifts.
From commerce to culture, software is digitizing every aspect of our lives. In the past, the undeniable tailwinds fueling SaaS companies led to lofty valuation multiples that made it easier to raise capital.
But this was a double-edged sword as the high prices exposed them to big drawdowns, and unfortunately, the industry has tumbled by 4.7% over the last six months. This performance was worse than the S&P 500’s 2.4% loss.
