$BFAM Short
Bright Horizons Family Solutions claims to be the largest employer-sponsored child-care and work/life provider. The CEO is a certain Stephen Kremer who previously founded College Coach which he sold to Bright Horizons. Reading 3 Yelp reviews out of the 4 seems like the service College Coach offers if shit. The smelly fish was that there was a single 5 star review and 4 other 1 star reviews. It looked exactly like the techniques Rocket Internet was using to cover its tracks while offering poor service to people but getting paid nonetheless. Now, even though Bright Horizons makes money today that doesn't mean that this way of doing business is sustainable. If customer dissatisfaction continues like this or worsens the reputation of the company is going to deteriorate with it and families won't send their children there anymore. This, plus from a technical point of view there has not been a single pullback since IPO. This company has literally been on a tear. Now, reading the financial statements you can see that earning's growth slowed down since last year. Important will be to monitor the next earning's call. If slower or negative earning's growth continues, consider shorting the stock and allow it to reach a more sustainable valuation.
We think that Bright Horizons is overvalued at this level and our price target is 100
We think that Bright Horizons is overvalued at this level and our price target is 100
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