Stocks trade at very high sales multiples. Palantir (PLTR) stands at 84 times sales. Rocket Lab (RKLB) trades at 36 times. Arm Holdings (ARM) is at 34 times sales. Cloudflare (NET) comes in at 30 times. Others range from 15 to 25 times sales.
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Palantir (PLTR) 84x sales
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Rocket Lab (RKLB) 36x sales
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Arm Holdings (ARM) 34x sales
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Cloudflare (NET) 30x sales
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Alabama Power (ALAB) 25x sales
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AppLovin (APP) 24x sales
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Robinhood (HOOD) 24x sales
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CrowdStrike (CRWD) 23x sales
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Broadcom (AVGO) 20x sales
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Circle (CRCL) 18x sales
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Snowflake (SNOW) 15x sales
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Roblox (RBLX) 15x sales
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NeuroBo Pharmaceuticals (NBIS) 15x sales
David Trainer, Founder and CEO of New Constructs, said, “Many investors are drawn to popular stocks without considering their fundamentals. This can lead to big losses.”
https://www.newconstructs.com/category/david-trainers-e-letters/
High sales multiples mean investors pay heavily for each dollar of sales. This pricing requires sustained growth to avoid sharp price drops. Many companies with these valuations must increase sales rapidly just to justify current prices.
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