Anyone who has ever spent any time living in Sydney's eastern suburbs will know from the number of beauty salons dotted around that looking good naked is a top priority for many Sydneysiders.
However, it seems the desire to look hot in front of others is even gripping the not-so-sexy world of funds management.
Yep, Australia's leading fund managers are all getting WAAAX'ed just to look good in front of their clients.
And I'm not kidding.
The valuations of Australia's sexiest tech stocks are going through the roof as some end of financial year window dressing sees fund managers race to add them to their portfolios in order to look like the hottest stock pickers going.
Wisetech Global Ltd (ASX: WTC) is up around 130% over the past year.
Afterpay Touch Group Ltd (ASX: AFT) is up around 225% over the past year.
Altium Limited (ASX: ALU) is up around 180% over the past year.
Appen Limited (ASX: ALU) is up around 220% over the past year.
Xero Limited (ASX: XRO) is up around 90% over the past year.
But it looks a little late for anyone else to get WAAAX'ed right now.
For example software-as-a-service logistics business Wisetech is now trading on 24x FY18's estimated revenues between $210 million to $220 million.
While trendy credit provider Afterpay delivered revenue of $60.7 million for the six-month period ending December 31 2017, but sports a market value close to $2 billion, which means it's changing hands for around 16x annualised revenues.
Appen is now trading on around 27x its own forecast for EBITDA up to $55 million in FY 2018.
While Xero's near doubling in value over the past year goes to show its attraction to Australia's funds management community, but if you're starting to find stocks sexy you might want to get out a bit more and wait for some more attractive valuations.
At today's levels the WAAAX stocks are definitely not going to smoke out the value investors, although they do look some of the best growth businesses on the local market.
However, I expect the second half of 2018 will see the valuations of some of these businesses come back to earth and given that investment returns are always a function of price paid a little patience in getting WAAAX'ed could pay dividends for smart investors.
