Sifting through the strewn wreckage of Covid darlings has been an extremely interesting exercise. Revisiting manias is a way for us to pound in the mistakes of others, so we don’t make them ourselves. I’m not ashamed, however, to say a younger version of myself made some of these same mistakes.
Redbubble $RBL.AX may well have been the darling’s darling of Covid momentum stocks. It is an Australian e-commerce company that enjoyed, for a short time at least, a triple Pandemic-induced tailwind:
A truly gargantuan amount of spending moved online as brick and mortar retails shuttered in early 2020,
That capital, for one glorious moment in time, was directed at a high margin item (masks), and
The shares of the company traded at an extraordinary valuation due to the short lived aforementioned theme, and a waterfall of retail money chasing high beta technology names.
The back-end fallout has been just as spectacular…
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