Abcam Share Discussion Threads

[lord loads of lolly] 01/2/2022 10:54

jeffian - totally agreed. I too hold ABC, though it's a fairly small part of my portfolio. I guess I was just trying to offer don carter a possible reason for the recent price falls. When markets get jittery, companies with abnormally high P/Es are especially vulnerable. Investors can lose risk appetite quickly, preferring bombed out "value" stocks to those where future growth has to be taken on trust to justify current valuations. They may not always be proved right, but human nature is what it is!

[jeffian] 31/1/2022 17:18

Yes, I too am very wary of very high PER stocks (though I hold some ABC). If you pay a very high multiple of earnings, you are paying today for assumed growth often way into the future, and if such a company stumbles on performance vs. profit projections, it will get hammered. I work on the assumption that, over time, all share valuations will revert to the mean (15x? or whatever) so if I pay more than that, I want pretty good visibility of earnings for the next 2/3 years and won't look beyond that timeframe.

However, I wouldn't compare ABC to "the dotcom boom". Many dotcom companies never made a penny piece in their lives, and probably never would, whereas ABC showed absolutely stellar earnings growth from nothing at the outset and although the growth curve may have flattened as the company matures, it's a real business generating real profit.

[lord loads of lolly] 31/1/2022 16:19

don carter - ever thought it could have something to do with the astronomically high P/E ratio? Yes, I know plenty of people dismiss this as irrelevant with potentially high growth companies. But they did that back in 2000 too, just as the dotcom boom peaked. And look what happened then.

[don carter] 31/1/2022 14:11

Decent trading statement. Why has interest disappeared here? The drop from 1720 has been overdone surely?

[mayers] 04/1/2022 17:44

Just for completion I cashed in my remaining holding just prior to Christmas at 1714p. Best wishes for continuing holders.

[mayers] 10/12/2021 16:46

Cashed a further 25% at 1711p on 07/12/21. This is a very quiet board.