Q: CSU seemed to have created a base between $3,300 and $3,400 but appears to be falling again the last two days to new lows. Is there anything new that explains such movement in the last 2 days. I was hoping that with it settling at $3,300 and tax loss selling over, it would have move up. Quite the opposite.
5i Research Answer:
It is largely the same fears as before, around AI. Some recent demos from Claude Cowork have 're-spooked' markets around the end of software which we think is overblown but for now the market is selling first and asking questions later. At 17X forward earnings and 12X EBITDA, the valuation is not hard to digest here and you need to go back 10 years to find it trading at a similar valuation.
When the sentiment on the name and software more broadly will turn is anyones guess but we think we are pretty close to peak negative sentiment.