Figma: After 70% Fall, Still Unreasonably Valued
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YR Research5.12K FollowersFollow5ShareSavePlay(8min)CommentsSummaryFigma remains highly overvalued despite a 70% drawdown, with no clear fundamental floor in sight.Q3 results showed strong revenue growth and customer expansion, but margin pressures are mounting due to aggressive R&D and AI costs.Even with optimistic growth and premium multiples, Figma projects subpar returns; a further 22% drop to ~$30 is needed to reach reasonable returns.I reiterate a 'Sell' rating, as the risk/reward profile remains unfavorable until valuation aligns with realistic long-term prospects.WilliamSherman/iStock via Getty Images Figma (FIG) shares are in a near-70% drawdown as its detached-from-reality valuation quickly came to bite those who ignored it. As I've warned in my October article, the pain of buying an extremely valued stock likeThis article was written byYR Research5.12K FollowersFollowI aim to invest in companies with perfect qualitative attributes, buy them at an attractive price based on fundamentals, and hold them forever. I hope to publish articles covering such companies approximately 3 times per week, with extensive quarterly follow-ups and constant updates.I manage a concentrated portfolio targeted at avoiding losers and maximizing exposure to big winners. This means that often I'll rate great companies at a 'Hold' because their growth opportunity is below my threshold, or their downside risk is too high.Analyst’s Disclosure:I/we have a beneficial long position in the shares of GOOG either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.Recommended For You