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Technology Stocks : EMC How high can it go? -- Ignore unavailable to you. Want to Upgrade?

To: Proud_Infidel who wrote (16741)	7/11/2006 1:42:44 PM
From: Lizzie Tudor	Read Replies (1) \| Respond to of 17183

Well, I need help finding more information on the 70s markets. There were very few growth companies in the 70s, but WMT and HD were a few I believe. What multiples did the few hypergrowth companies get in the 70s? It could be that GOOGs 30 forward PE (INCLUDING OPTIONS EXPENSES which artificially deflate the numbers) are at 70s-level for hypergrowth. The overall market is more expensive than the 70s for sure. here is an interesting article about the 70s bear vs. today. Interesting they identified GOOG as one standout that "just has to fall" (which likely means- GOOG will not fall). JMO. Are we still in the belly of the bear? Easterling marks 1999 as the final year of the last secular bull market and the beginning of the current secular bear market. That puts us a little more than 6 years into the cycle. As of June 30, the P/E for the S&P 500 stood at 17.5 -- that's slightly above the long-term average of 16, and well above the historical bear market bottom of 8 to 12. I'd certainly like to think we're at the beginning of the next secular bull market, but relatively high P/Es, rising interest rates, and signs of increasing inflation lead me to believe we're still in the belly of the bear. In this environment, richly valued companies that don't pay dividends -- like Google (Nasdaq: GOOG) and Chipotle Mexican Grill (NYSE: CMG) -- can be lethal to a portfolio, as P/E ratios contract without payouts to cushion the blow. For further evidence, just take a look at Urban Outfitters (Nasdaq: URBN). By all accounts, it's a well-run company, but it was simply valued too richly. And while the company has struggled a bit this past quarter, the market's swoon quickly compounded the decline. fool.com