Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Amazon.com, Inc. (AMZN) -- Ignore unavailable to you. Want to Upgrade?

To: JBL who wrote (91842)	1/22/2000 12:41:00 PM
From: 16yearcycle	Respond to of 164684

MSFT is not a great example of overvaluation, when it is selling at a market multiple and growing much faster. Their accounting is conservative. Msft may well be the only big cap tech that is not overvalued. They will earn about 30 billion dollars in the next 3 years. A 500 billion cap is easy. It is not participating in this charge as it is held down by the on going litigation in many ways. Now, if you had said Sunw, Csco, Orcl, Emc, Jdsu, Amat, Brcm, Aol, Nok...... As far as Dow 36,000, I have no problem with that at all. The dow could have earn. of 1400 in 6-7 years and be priced about right at 36,000+. The problem lies with the nas 100. There are a lot of smart folks who seem very unwilling to say the words, "too high." There are prices that are too high to pay for great companies and we have gone way past them. Just 5 months ago, folks were scared to buy CSCO at 50x current e, but are now wiling to pay 120x, and want to justify it. Sunw' stock is up 300% in a time period where e have grown 40%. Aol is selling at 160X e when management says it will grow at 30% or so. I have never seen THAT happen, without a brutal drop. It is Alice in Wonderland time in the tech world. Can anyone here even begin to conceive of what is going to happen if rumors start flying in late March that 2nd half tech spending is going to slow? This is not an unlkely scenario, that with the fed tightening and rates rising, and with pre and post y2k spending settling down, that growth slows. Not stops, slows. These stocks are priced for no problems in sight. Stocks with 100% growth rates drop 60-75% when growth slows. Heck, 50% drops are normal in high growth stocks on short term scares, even when growth DOESN'T slow.