Clouded Judgement

The article analyzes the March 2022 rally in cloud software stocks, attributing it primarily to short covering and retail option activity rather than fundamental investor conviction, and argues the bounce does not constitute a sustainable recovery given macro headwinds and CIO budget uncertainty. The author provides detailed SaaS valuation multiples, operating metrics, and benchmarking data across top public cloud software companies, highlighting the disconnect between high EV/revenue multiples and deteriorating profitability metrics.