The New Technology Market Bubble
Best Growth Stock – The multimillion-dollar purchase of Skype from Microsoft and the opulent output listing of Linkedin would be generating a new similar to the 1990s technology bubble.
The alarms of the major exchanges in the world are high and not on behalf of a new global financial crisis, or for another mortgage debacle. This time the fears have to do with the internet and the possibility of that is looming–again a technology bubble. Something similar to what happened in the early 1990s, when the world believed to have found the “new economy”, but that ended up exploding in 2000 with the demise of several firms in Silicon Valley.
And the latest multi-million dollar transactions that are occurring in the sector have more than one with the hair stand on end. One of them, the recent purchase of Skype by Microsoft more than US$ 8 billion, almost three times more than what was paid in 2009 for the Ebay auction site. Although the owner of Microsoft, Bill Gates, justified the purchase by saying that “it will generate a large amount of innovation”, several Wall Street analysts think that you it’s an inflated price.
Another move came a week ago, when the social network Linkedin came out to the technology exchange Nasdaq in New York. In a day, its shares went from US$ 35 to US$ 93, reaching a valuation of $8,900 million market. Results that seem to get out of all logic, if you consider that this website was last year utilities for only US$ 15 million.
The jewels in the Crown of this “digital gold rush” – as her magazine The Economist – it has baptized are definitely Facebook and Twitter. The companies are valued at $80,000 million and US$ 10,000 million, respectively, figures much higher of their financial models and revenue. Both have attracted the most avid investors in the world, such as Goldman Sachs in the case of Facebook. And the two leave the stock market from next year. Of course, several analysts of the planet anticipate that there will be an unprecedented success.
So far, the next social network that will be publicly listed its shares will be Groupon, a service of online shopping with discount which already obtained US$ 1 billion in a round of pre-financiamiento, a couple of months ago. This web site is valued at US$ 6,000 million but, once entering the stock market, it could soar to $20,000 million.
It should be noted that, despite these figures, for some experts cannot compare this situation with the end of the 1990s.
They argue that, in contrast to then – when there were millions of sites each day-social networks now point to monopolies and consolidation in very few companies. It is clear that there will be a very wide spread of income.
Else thinks the Economist magazine. For the British weekly, the best thing is to walk carefully in the middle of what appears to be a new “irrational exuberance” of the markets in the world. Time will tell who is right.
Category: Business News
