yes, reality is beginning to set in on valuations
but I suspect it will focus on the Walking Skeleton internet stocks initially
you seem to think all high valuation stocks will be hit?
perhaps initially, but real profit growth will sustain the valuations
and so will real niche ownership and domination
e.g. Qualcomm, Uniphase, and other strong gorilla charlatans
like Siebel and Real Networks
then you have the array of superduper niche players whose growth will sustain their prices
e.g. CREE, ELON, CNXT, NTAP, FDRY, TERN, JNPR, ATML
I tend to think many high valuation stocks will be challenged
I would prefer to see such jokes as Cisco knocked down a peg
that is a $44 stock if I ever saw one, not $74
CSCO PE now trades at about 3.2 times its growth rate
... and a valuation of $500B
CSCO is now enjoying rich internet valuation that aint gonna last long
CSCO is seen as the largecap internet networking pure play
give me a break !!! bring in Nortel and whack their arrogant asses
raising attention to the QQQ is wise
that is a better measure of the Nasdaq than the composite
I need to run charts on QQQ more often
in my view, the S&P is to the Dow what the QQQ is to the NazComp
the Dow is 30 stocks, with maybe ten dominating
would you believe almost 80% of the NazComp is made of ?
MSFT, CSCO, INTC, ORCL, QCOM, JDSU
this summer the internets burn, baby, burn
that is: burn out, not rise up
trouble is, stars like ITWO, CMRC, INKT will get hurt
profits and profit growth is what will direct the burning
so many of these firms are profit skeletons without an ounce of meat profit on them
sales growth does not justify market capitalization in my book
just watch Amazon go down in flames in the next 15 months !!!
yeah, take DrKoop down to 25 cents per share
and take Street.com down to 12.5 cents per share
take Amazon down to $5 where it belongs
and take the majority of the remaining internets down 75%
once the internet consolidation accelerates, valuations have forever lost the benefit of massive ambiguity
interesting how the biotechs got a worse whacking than many internet stocks, and they have real legitimate promise of revolutionary concepts and products
just shows how dangerous speculation is, and how much ambiguity still remains ensconced within the internet
how many times have we heard "nobody knows the potential of the internet?"
/ Jim Willie |
