Between 1995 and 2000, the peak of the dot-com bubble, the Nasdaq Composite stock market index rose 400%. It reached a price–earnings ratio of 200, dwarfing the peak price–earnings ratio of 80 for the Japanese Nikkei 225 during the Japanese asset price bubble of 1991.
On March 10, 2000, the index peaked at 5,132.52, but fell 78% from its peak by October 2002.
Tesla stock is significantly overvalued at current levels. Tesla trades at about 15x projected 2021 revenue and about 175x projected earnings. There’s little precedent for this sort of a valuation in the highly cyclical and capital intensive auto industry in recent history.
Tesla, which skyrocketed 740% in 2020, won't repeat the performance in 2021. Meanwhile, the top performing SPAC according to Nasdaq, QuantumScape, flew over 1,115% in 2020.
This market is driven by intense speculation, but also by fiscally pumped, central bank-primed corporate earnings, which when discounted to present value by near zero nominal and in many cases negative real interest rates, produce record stock prices.
tech bubble 2.0?
On March 10, 2000, the index peaked at 5,132.52, but fell 78% from its peak by October 2002.
Tesla stock is significantly overvalued at current levels. Tesla trades at about 15x projected 2021 revenue and about 175x projected earnings. There’s little precedent for this sort of a valuation in the highly cyclical and capital intensive auto industry in recent history.
Tesla, which skyrocketed 740% in 2020, won't repeat the performance in 2021. Meanwhile, the top performing SPAC according to Nasdaq, QuantumScape, flew over 1,115% in 2020.
This market is driven by intense speculation, but also by fiscally pumped, central bank-primed corporate earnings, which when discounted to present value by near zero nominal and in many cases negative real interest rates, produce record stock prices.