High-multiple hell! This group trades as if they are all coffee companies or oil refiners. They correlate so closely.
So when people dissect Salesforce.com (CRM) and they see the hole in deferred revenue -- which I think does matter despite the high growth -- they punish CRM, but they also go after Amazon (AMZN), VMware (VMW) and Google (GOOG) but also Chipotle (CMG) and even Lululemon (LULU), Ralph Lauren (RL) and Baidu (BIDU).
I know that sounds nuts. But the people in these stocks are simply looking at stocks by growth rate, not valuation, and they feel that their thesis is hit hard by a miss in any of its players -- as you would with a shortfall in any refiner for the refiners and any coffee company for that sector.
I know that seems dopey. But I have to tell you that I don't like this high-multiple group for this moment because everything has to go right to make these stocks go to the next level, and that's a very tough call in this particular environment -- as we saw from Netflix (NFLX).
Or, to put it another way, if you can choose between high growth and high dividend, the latter's winning every day of the week these days, and I think that's only going to get more pronounced -- not less -- as we go into the end of the year.