I’ve had AMZN on my watchlist for a while and I’ve been trying to find a decent entry point for some time.
So, I had a look at AMZN’s valuation and I saw a P/S ratio of 4.03 and a P/E ratio of 63.7, both of which would usually indicate that a stock is very overvalued.
I’m still of the opinion that AMZN might actually still be overvalued, and that we’re still going to have to wait sometime until we see some growth there.
The situation with AAPL is quite bad too; P/S is 6.49 and P/E is 28.43. GOOGL, V, MA, MSFT and pretty much any kind of large cap tech stock has ridiculously high valuation figures.
So my question is, why do people continue to think that tech stocks are a great buy with these kinds of figures? To me personally, it appears that a lot of the anticipated growth is already heavily priced in, and that growth in the stock itself will take a long time (that is until the company’s intrinsic value catches up with it’s valuation).