Shark, VTSS could be a short candidate, some day. Right now, how do you feel about sticking your hand in a buzzsaw; play dodge-em cars with a locomotive?
Could you explain your rationale re: "my models it only works if you can assume P/S greater than 10 for next 4 years" ?
IMO, you are going to see quite a margin expansion for the niche companies like VTSS, meaning there should be less dependence on sharp revenue increases to get the continuing increases in net earnings.
If I have read recent data correctly, this is already happening, giving VTSS an increase of 180%in total net income for the 9 months, and a per share net increase of 114 % (because shares outstanding jumped almost 30%).
Consequently, also IMO, you would be looking at an excessive PE as the basis for the short sale, rather than an excessive P/S. OK, so the current PE is up in the 60's, and the earnings growth is still exceeding 100%. One more year of such growth, and the PE is back into the high 20's against the current share price of around $50. Would you call that excessive and put VTSS up as a good short candidate? I have difficulty seeing that.
As for the insider selling -- wouldn't that be expected for guys who are getting much of their income in stock rather than cash? If someone has evidence that key players are seriously reducing their stake in VTSS, I would start to worry a little. Meanwhile -- Where do I buy more??? ":-) Just my thoughts. You could be entirely right and I could regret not selling (but will take my chances) dlo |
