The buzzword of the year is without a doubt, “AI”. With generative AI taking the world by storm, investors’ expectations are through the roof. Tiny companies with “AI” in their name are seeing triple-digit returns on their stocks in the span of a couple months with people everywhere riding the hype train. Amid this generative AI mania lies Bill.com (BILL), a company using artificial intelligence in a much less sexy way.
We first mentioned Bill.com (or simply “Bill”, as it is now known) in our 2021 piece on 5 Pure-Play Stocks for the B2B Payments Thesis. At the time, Bill had a simple valuation ratio (SVR) of 96 – a truly massive valuation. For reference, our most richly valued holding, NVIDIA (NVDA), currently has an SVR of 28, and we don’t invest in anything with a ratio greater than 20 these days (down from 40 during the bull market). Consequently, we weren't interested in Bill back then. Here's how we concluded our last piece:
As for company spending, we see several stocks w...
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