Are we going higher?
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Mad Dash to Nasdaq
By TSC Staff
12/14/99 8:16 PM ET
Over the last 12 months the
Nasdaq Composite Index has
surged some 80%, adding $2
trillion in market capitalization to
the stock market's leading gauge
of technology-related stocks. And
in the last month alone the
Nasdaq has leaped more than 20%, setting record after
record as investors pile into stocks that promise to take
part in building the next century's evolving information
infrastructure.
Yet it's clear that the fundamentals of these stocks
haven't changed so much that they uniformly deserve
these remarkably higher prices; clearly, these stories
have been driven less by news and analysis than by a
pervasive sense that the sector's trend is strongly,
perhaps irreversibly, up. Prelude is prologue.
At the heart of the move are
a handful of stocks whose
already tremendous returns
this year have lately gone
ballistic. For some, like
Yahoo! (YHOO:Nasdaq - news), recently added to the
S&P 500, the dynamics of the move are at least in
some way understandable. But for others, the dynamics
of the move are less clear. Why has Check Point
Software (CHKP:Nasdaq - news) run so hard in the
last week? Where is the deal, the takeout rumor? What
closely followed analyst goosed the stock? What's
happening with Ciena (CIEN:Nasdaq - news), with
Intuit (INTU:Nasdaq - news), with CMGI (CMGI:Nasdaq
- news)? In many cases, it seems the biggest reason
these stocks have jumped recently is investors buying
them on the basis of their incredible performances this
year.
It's time -- it's past time -- to take apart what's behind
this move. To examine who's buying these stocks and
why. To take a hard look at the companies involved.
And to start asking what happens next. |
