"Absolutely anything goes in this market, particularly in the Internet arena. Before we go any further let's just take a look at a few numbers: Price/Sales Ratio= 81.61; Earnings= none expected until 2000 (of course, this is an Internet stock, so analysts would have no problem pushing profitability forecasts out another year or two if sales don't happen to pan out as expected); Percentage Price Gain since Jan. 30 IPO= 171%. Please, don't misunderstand. We have no problem with investors making money on hot, rapidly expanding Internet stocks. It is just that at some point you just begin to ask yourself: "Does valuation play any role in this market, at all?" Even trading-oriented investors such as myself should be concerned with this market's ebullience. After all, no one wants the punch bowl to be yanked away by a market collapse. That is why when I see stocks as ridiculously overpriced as VeriSign, it makes me quiver. Eventually, this stock is going to come down hard, just like so many other super-IPOs have. But until this market starts to show that it has a conscience, you won't catch me shorting the VeriSign's of the world. However, once that signal is flashed, shorts will have an opportunity to ride many of these overvalued names down 40 and 50 percent, sometimes in a matter of weeks." Taken from briefing.com
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