Les Billets de Monocle

Tuto Valo

24 November 2022

Part 1

Zoom, the meltdown.

Share price two years ago: $427. Share price today: $76. A drop of 82%.

Until now, the decline in the share price was due to growth, which was always weaker than investors expected and because of the company's valuation, completely disconnected from its fundamentals.

Now we can add a new element: margins are collapsing under the weight of staff compensation in shares (which rose from $115 million last year to $303 million in the last quarter... Yes, keeping staff motivated is expensive).
The stock was down 4% on Tuesday morning after the results were announced.

We told you about Zoom on the 24th of December 2020.
We wrote "The end of the pandemic will not help sales. Its competitors (Microsoft, Cisco) will be putting in a lot of effort to regain market share. A valuation of $130 billion seems like a lot ».

Aujourd’hui, Zoom vaut $23 milliards.

You often hear about companies that are considered to be overvalued. So you are probably wondering how to value a company. We propose a little game to answer this question.

Part 2

Nous sommes au mois d’août, vous êtes en vacances à Hossegor, dans le Sud-Ouest dans la France.

As a surfing fan, you've always dreamed of giving up your office job in Paris to open a surfboard rental business here.

One morning, you are walking on the Place des Landais and start a discussion with the manager of a rental.

After talking about the wind and wave forecast for the week, you launch:

"Are you selling ?"

"How much are you willing to pay?" is answered.

You leave with some paperwork and promise to get back to her within a week, before you return to Paris.

In a normal year, the rental generates 300,000€ of turnover and 30,000€ of margin, net of all costs (rent, salaries, depreciation of boards, taxes, etc).

What is the value of this business?

Answer A : 100,000€
Answer B : 300,000€
Answer C : 600,000€
Réponse D : 900,000€

Answer us by mail and we will give some insights in next week's Billet (your answers will of course remain confidential).

Market and portfolio focus

Over the week (from 15/11 to 22/11), the fund and the Nasdaq remain stable (joint contraction of 0.1%).

No change in positioning on our side, we maintain our net equity exposure of 11% and have not made any line changes in the portfolio.

Have a great week,


This presentation is a promotional document. The content of this document is communicated by and is the property of Monocle Asset Management. Monocle Asset Management is a portfolio management company approved by the Autorité des Marchés Financiers under number GP-20000040 and registered with the ORIAS as an insurance broker under number 10058146. No information contained in this document should be construed as having any contractual value. This document is produced for information purposes only. The prospects mentioned are subject to change and do not constitute a commitment or a guarantee. Access to the products and services presented here may be subject to restrictions for certain persons or countries. Tax treatment depends on individual circumstances. The fund mentioned in this document (Monocle Fund SICAV) is authorized for marketing in France and possibly in other countries where the law permits. Before making any investment, it is advisable to check whether the investor is legally entitled to subscribe to the fund. The risks, costs and recommended investment period of the funds presented are described in the KIDD (key investor information documents) and the prospectus, available free of charge from Monocle Asset Management and on the website. The KIDD must be given to the subscribers before the subscription. Past performances are not a reliable indicator of future performances. Monocle Asset Management cannot be held responsible for any decision taken or not taken on the basis of information contained in this document, nor for the use that could be made by a third party. The investor may lose all or part of the amount of capital invested, as the funds are not capital guaranteed.

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