Worse Than the Dot-Com Crash? Why Michael Burry Thinks the Market Is in Deep Trouble
The dot-com crash is known for being one of the worst stock market collapses in recent memory. It came at a time when the internet was in its infancy, and many stocks were surging in value simply due to hype. Investors sometimes compare the euphoria around artificial intelligence (AI) stocks today to how the market was back then. The S&P 500 (SNPINDEX: ^GSPC) is coming off a third straight year of double-digit percentage gains, which may be worrying investors that a crash or a serious correction is inevitable.However, unlike in the dot-com bubble where many risky internet stocks with no revenue or earnings were soaring, the companies that have been taking off in recent years are making real profits and have strong financial results, justifying their valuations. Nvidia, for instance, has become a growth machine. While its valuation looks rich with a market cap of about $4.6 trillion, its forward price-to-earnings (P/E) ratio (which is based on analyst estimates), is less than 25 and might not look all that expensive in light of its growth potential.Continue readingWeiter zum vollständigen Artikel bei MotleyFool
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