Another note is that this is on forward earnings. What may have just happened is analyst expectations on forward earnings have caught up what markets prices earlier. Forward earnings generally lag pricing, this happens on the way up, and on the way down..
Are there any other notable IT companies that aren't actually part of the S&P500 IT sector?
Edit: Apparently this happened in 2018 and is known as the de-FAANGing of the IT sector. I.e. FAANG used to all be lumped in a single sector. ^SPX tried to redistribute to spread the companies across different sectors. AMZN is another notable company now outside of IT sector. https://en.wikipedia.org/wiki/Communication_services_sector_...
I recall that there's an "extended tech" ETF that does a pretty good job of actually capturing the whole IT universe. Pretty sure I'm thinking of IGM: https://www.ishares.com/us/products/239769/ishares-north-ame...
o true. this is a classic reporting/analytics yoy comparison type blunder, that actually makes graph in OP kind of meaningless. much more surgical comparison is needed here. now i cant help but chuckle at the total absolute that is the headline lol. grab all "IT flavored" companies that exist today, find the ones that existed then, then compare valuations between those two periods. perhaps ignore the S&P "IT" classification entirely since that groupings definition is apparently now just a moving target between 2018 & now :shrug:
> Pretty sure I'm thinking of IGM:
actually really cool thanks for putting this on my radar
So hopefully soon we will have dirt cheap prices for ram and other chips.
sfblah•1h ago
jjmarr•1h ago
> The chart below compares the forward P/E ratios for the S&P 500 and the S&P 500 Information Technology sector.
> Tech valuations have compressed from 40x to 20x, and we are back at levels last seen before the AI boom began
Forward PE is the ratio of stock price to anticipated earnings.
If it's higher, then investors are predicting future growth in a company.