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Strategies & Market Trends : Zeev's Turnips - No Politics
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To: Steve Lee who started this subject4/27/2002 1:06:07 PM
From: exp  Read Replies (1) of 99280
 
TECHS NOW HAVE P/E=40 USING 12 MO FORWARD EPS (see link):

COMPQ FAIR VALUE P/E=25-30->COMPQ FAIR VALUE=1,050-1,250
story.news.yahoo.com

Cruising for a Fall in Tech Stocks?
Sat Apr 27,11:42 AM ET
By Pierre Belec

NEW YORK (Reuters) - The recovery of technology stocks is still a great illusion and investors may soon find out -- again -- that owning a piece of the once-hot New Economy is not as thrilling as it used to be.
Last year was supposed to be the worst of times for technology companies. The betting was 2002 would be a recovery year. But the horror stories are still making headlines.
Just about everything technology-related was back in Wall Street's dog house this week after a slew of heavyweights didn't deliver the numbers they had promised in the first quarter. Earnings targets were missed as revenues shrank. Companies are pushing their profit recovery forecasts as far out as next year because the demand drought has gotten worse.
Yet investors haven't given up on the tech stocks and they've priced them out of this world. The sector commands an incredibly high price-earnings ratio of 40 times expected earnings for the next 12 months, or twice the P/E of the average stock in the Standard & Poor's 500 index.
Investors' appetite for risk remains high even after hundreds of billions of investment dollars went up in smoke when the market bubble burst in March 2000.
What's happening is some people have bought into the idea that stocks that have been battered for so long are going to eventually come back up.
....
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