Vulnerable Valuations Are Seen in U.S. Technology Stocks
“Investors have decided that U.S. equity valuations don’t matter anymore” and technology shares are vulnerable to a change of heart, Albert Edwards, a global strategist at Societe Generale SA, wrote in a note to clients Thursday. Using projected earnings, he compared the industry group with the broader market and value shares. The forward price-earnings ratio for the S&P 500 Information Technology Index ended last week at 27.4, according to data compiled by Bloomberg. Tech was 22% more expensive than the S&P 500 and 52% more costly than the S&P 500 Value Index. Premiums three years earlier were just 5% and 20%, respectively.