VTSS PE is in line with the market -
In following several notes over the past weeks, I have noticed that VTSS PE of 75 is said to be one of the highest in the market. I may be jaded somewhat by focusing so heavily on the technology industry, but it is hard to consider VTSS out of line for a company with sales of only $66m and scheduled to grow by 70% next year. Many larger and better established tech companies with smaller growth potential trade at comparable multiples:
CSCC-94, PSFT-100+, ASND-76, ORCL-49, CSCO-50, COMS-62, FORE-63, BAAN-100+, MSFT-43, ...
Taken in context of the tech industry, VTSS PE does not seem to be out of line. I would agree, however, that trading tech stocks does present more risk than does trading the DOW30 industrials. Peoplesoft, as an example, has traded over PE100 for several years now. While obviously risky at that multiple, a lot of money has been made in Peoplesoft! |
