lets use NVDA. It closed at $205. In the next 12 months, will they be making more money than they did when the stock was $105? i doubt it. How about Google, facebook, apple, lam research, apllied materials? Lets say company xyz went from 300 to 200 in a month, sounds like its cheap. However, when it was 300 their revenue projections were 800 million. Now at $200, revenue projections for next year are only 499 million. When the stock was only 100, the projections were actually 650 million. That means even at 200, the stock is very expensive. this is just an example obviously however, stocks still have a lot more downside. These are valid questions. Any opinions?
Growth stocks like you are referring to aren’t about value but potential growth. People hoard apple because it’s leading consumer tech innovation. What if they come out again with some revolutionary product like the iphone back in 08’? I call that “overvaluation”: the price of CEO.