Tech Stock Valuation

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INVESTMENT ADVICE ON

THE INTERNET

Nowhere is the exploding interest in Internet investing more evident than on the

Internet itself. “Dot.com daffiness” or “Tilt-a-whirl Technology” is how Barron’s

describes it.

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When it comes to Internet investing, poring over earnings reports

and balance sheets often seems to do little good. During the late-1990s, big win-

ners among the Internet stocks seldom had any earnings, book values, meaning-

ful revenues, or fundamental value of any kind—at least when measured using

conventional criteria (see Hirschey, 1998). In the seemingly upside-down world

of Internet investing, Internet stock analysts sometimes describe ...