Why Technology Is Not a Bubble

June 19, 2018//-For a look at just how much technology dominates global markets, consider this: the market capitalization of the largest technology companies globally is now comparable to the annual GDP of Europe’s largest economies.

The top five US tech stocks have a combined market cap that exceeds the combined value of the 50 companies in the EuroStoxx index. Such growth might remind investors of the frenzied tech bubble of the 1990s, but today’s technology gains have come on the back of growth in both revenue and profit margins that has far exceeded the market as a whole.

“Margin expansion and stronger earnings have explained most of the returns in the technology sector in recent years,” according to Goldman Sachs Research’s Peter Oppenheimer.

 

Leave a Reply

*