The top 10 performers in the Nasdaq 100 (NDX) over the past year are up an average of 784%, according to BTIG’s Jonathan Krinsky, topping the 622% average gain for the index’s biggest winners in the year leading into its March 2000 peak.
The Nasdaq's top winners are now running hotter than in 2000
byu/-Mahn ininvesting
Posted by -Mahn
5 Comments
This time they’re profitable, is the common retort.
Personally I don’t see how this works out.
We’re not going to double our energy output in five years. Not going to happen. Not even in ten or fifteen.
Were their earnings also as non existent as in 2000?
Yeah look at their earnings compared to 1999
2000 was speculation about future profits.
2026 is pricing in existing ones.
There is some truth to this, but there are big differences. The high flyers with nosebleed valuations in 1999 were often small “dotcom” companies that had never posted positive earnings before, but were burning through cash at an alarming rate. When the bubble burst in early 2000, these stocks really had no floor because they had no earnings and the growth projections suddenly shifted for the worst. Many went to zero and went out of business. With the top stocks of today, these are huge companies with many billions in earnings. Even if we hit a bear market and the bubble pops, these are still going to be very big companies with a lot of earnings that will likely put the floor on how far they can fall. It can still end very badly, of course, but I see that as adding some protection against the worst case on the downside.
So yes, this is feeling like a bubble forming to me, with some similarities to 1998 or 1999. But the fundamentals of the companies whose stocks are being inflated by this bubble are much more stable and secure than they were back then.