D'ai of the Triffids: Office Software Triage (Abridged Version)
원문 보기 (영문) →한국어 번역이 곧 추가됩니다. 그 동안 아래 영문 원문 또는 출처 사이트를 참고해주세요.
[What follows is an abridged ~1500 word summary of the full D’ai of the Triffids: Office Software Triage post available here. This is the first part in a six-part series covering 46 software and payments stocks. The full version has ~11,000 more words and several more visuals, which are especially helpful in understanding the valuation section; I recommend reading the full version, as the truncated valuation section and especially the truncated company bullets are not to my standards.]
Late last year, two private companies financed heavily by private credit went bankrupt and shook the market.
Private credit funds looking to hedge illiquid private portfolio assets in distress turned to public markets. Software and SaaS stocks starting selling off, and the selloffs dovetailed with a burgeoning narrative highlighting the AI threat to SaaS companies.
Then, on February 5th, Anthropic launched Agentic AI plug-ins, and the S&P 500 Software & Service index fell an additional 17% over six days.
As the turmoil continues, I will analyze 46 software and payments stocks (the SW46) over a six-part series.
Start with earnings. No mercy, no bias in the analysis. The analyst must not stop at true SBC expense, as described in The Tragic Algebra Recurrence, but must also examine uneconomic D&A policies, normalize tax rates, and account for non-cancellable purchase obligations as well as capital lease payments, among many other adjustments necessary to uncover true economic owners’ earnings.
In addition to what is discoverable in financial statements, I established AI Competitive Threat (AICT) Tiering, which focuses on native AI threats and other competitive threats from within the industry or sector that may, or may not, be aided and abetted by a foundation model. AICT comprises five tiers of threat risk, each one differentially guiding the valuation of these software and payments companies.