tech stocks too expensive - tech stocks too expensive
"tech stocks are way too expensive - tech stocks are way too expensive"
what is this about tech stocks being too expensive? What this all about..... See below.
------------------------------
Sentiment Trader told ==> our VIP MEMBERS here <== that we know how hard it is to compare stocks using their individual valuations.
The only tools investors really have to value a stock are the given company's total addressable market and its price-to-earnings multiple, or the share price relative to the earnings per share.
In the end, valuing stocks is either totally straightforward or totally mystifying — one or the other For a certain group of stocks, it's much more of an art than a science. And right now that is the case....
For example, investors trying to pin down the value of Netflix will run into trouble because the streaming giant barely has any earnings.
For example Valuing Amazon is just as tricky. Amazon's retail and cloud businesses could be worth $750 billion and $250 billion respectively, which would mean the $1,140 stock could still double, by any stretch of the imagination.
If investors considered that possibility, the recent technology stock sell-off would make shares of Amazon seem like a bargain if we were looking over the longer term!.
Realistically Value is entirely in the eye of the beholder considering its lack of earnings.
We all accept these valuations in the consumer packaged goods space despite uninspiring growth rates and now-meager dividends, It's stereotyping, plain and simple.
Plus no one is really talking about XLK or the tech sector right now!.
Sure we have had a little sell off, but its nothing much to sneeze at, and because there are divergences in the chart, which you can see on the macd, sure we can go lower, as the MACD still holds its sell signal, but it feels like this is nothing more than a DIP before the next rally. People are suggesting this is the start of the big one, but the charts sure do not smell like that is what is coming
-- See the chart below....- A sell off, yes, but the start of a crash, we do not think so, as its more of an orderly selloff inside a nice downwards channel!
Our Members here => VIP members here Were told that stocks like Apple, Alphabet and Facebook are viewed as too expensive despite having larger addressable markets and faster growth than the consumer goods names.
Apple's growth rate, for one, could go as high as 25 percent by some estimates. Still, the tech stock has a price-to-earnings multiple of 14, a huge discount to the consumer goods names.
Similarly, analysts put Facebook's growth rate at 21 percent with a 21 times price-to-earnings estimate for 2019. Alphabet has a 17 percent growth rate and sells at 24 times 2018 earnings estimates.
So its pretty obvious to us here at Sentiment trader : that the stocks we like and are cheaper, on a price-to-earnings basis.
CONCLUSION....
We hear many bloggers and traders say that Facebook or Alphabet or Apple have gotten so expensive that you can't possibly own them, but when you actually do the arithmetic exercises you don't get that conclusion, on a price earnings ratio.
tech's much cheaper than you think. Can It go lower? Well, yes sure, but It just doesn't usually get explained in comparison to what's really expensive out there. So we do not think this amazing TECH rally is quite done just yet!
DON'T MISS OUT ON OUR HOTTEST updates Click the link below....
No comments:
Post a Comment