Technology: Sector Appears Overvalued Despite Birth of First Trillion-Dollar-Market-Cap Stock in Apple
Cloud computing, trade wars, and M&A remain hot topics in the tech sector.
We view the technology sector as slightly overvalued overall at a market-cap-weighted price/fair value of 1.075 as of Aug. 31, versus 1.02 at the end of May, 1.05 at the end of February, and 1.08 at the end of November 2017. The Nasdaq index has risen about 3% from mid-June to mid-September and is up about 16% year to date as of mid-September. We can’t look at market capitalizations in technology without noting the birth of the first trillion-dollar-market-cap company as Apple crossed the barrier this quarter.
Brian Colello does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.