Last month, I published my fair value of Meta Platforms (NASD:META) (https://www.veriteventures.com/post/meta-platforms-inc-nasd-meta-my-fair-value-estimate), which was $117.03. I also deemed the company good quantitatively and thus likely to have durable competitive advantages. Given those possible advantages, I plan to be a long-term shareholder. But, I also practice rules-based investing (https://www.veriteventures.com/post/what-is-investing), and one of my rules is that when something becomes overvalued by 50%, I sell at least a portion of the position. So today, I sold 18% of my shares and 25% of my call options.
If I had to, I would guess shares will move significantly higher over the long-term. But, I don't have to guess and I have rules. So, I sold enough to keep the absolute size of the position about the same given the size of today's gain and I'll look to redeploy that cash into a company that is relatively cheaper.
-V
For more information about how and why I designate companies good read here: (https://www.veriteventures.com/post/how-i-value-good-companies)
Post prepared using data as of 2/2/23
The information in this post has not been audited and accuracy is not guaranteed. The post is for informational purposes only and is not investment advice. Consult a financial professional before making investment decisions. The author’s opinions and positions may change subsequently, without notice.