I would rather pay a fair premium for a business whose earnings, cash flow and competitive position are still strengthening than buy a falling stock simply because it looks cheaper. Momentum backed by fundamentals can persist far longer than expected.
The key is distinguishing expensive from overvalued. For names like $NVDA, $GOOG or $META, I would watch earnings growth and forward guidance rather than the share price alone. A 30x multiple with rapidly rising earnings can ultimately be cheaper than a 15x stock with deteriorating fundamentals.
Buying the dip works when the market has overreacted. But a falling price by itself is not a thesis. Sometimes the dip keeps dipping because the business outlook has genuinely changed.
So A for me, but only when the fundamentals are chasing the price higher too.
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