The Validation of Valuations
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The serious long term Retail Investor needs to truly understanding where the core or essence of the industry could be headed as that may be critical for long term success.
It seems to me that a lot of analysis out there is either anecdotal or rooted in projected sales based on using pre-existing forecasting models. That is not to suggest one should not look at projected growth, sales, and earnings or use past performance as an indicator but rather one should not do so without remembering the learnings found in our first issues published years ago that remain just as current today. Or another way to look at this is to ask whether the existing forecast models used by so many accommodate existing billion dollar illegal industries that are transitioning to legal regulated industries? I confess – a rhetorical question indeed but let them try to fit that square peg into the round hole.
To the best of my knowledge, I was the first to refer to the industry, from the perspective of an individual investor, as a vibrant eco system that is undergoing tremendous shocks to bring it out of the black market and into a legal regulated market and to refer to those shocks as “Ecoforming” events whereby Ecoforming is analogous to the concept of Terraforming made famous in Science Fiction. In other words, what humans are doing to make an environment more hospitable. In Science Fiction, Terraforming transforms the physical environment and perhaps even the atmosphere so that human colonies can not only survive but thrive. Natural disasters and mishaps often occur in sci fi.
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