We Are Not in a Tech Bubble, but…: Theodosopoulos

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Jan. 16 (Bloomberg) –- NT Advisors Founder Nikos Theodosopoulos discusses the similarities between the tech bubble of the year 2000 and the atmosphere of today’s tech market with Deirdre Bolton on Bloomberg Television’s “Money Moves.” (Source: Bloomberg)

The cd common characteristics now?

We're definitely not a tech bubble now.

It's not the mania we saw back then.

Back then, it was just put.com after the company name and you can raise would you want.

My plumber was income of the cab driver was in.

It's clearly not like that now.

Having said that, if you look at a subset of technology companies in cloud and social media, 3-d printing, the evaluation of these companies, 30 to 50 times trailing revenue is historically excessive.

At the bubble, they were trading at 200 times trailing revenue.

What that suggests is extreme hypergrowth for the next several years.

In other words, these country -- these companies can trade up their levels but they better grow fast?


If we look at the post bubble era, the past -- since 2000, salesforce.com and vmware are great examples of hypergrowth, disruptive companies.

These companies would be ecstatic if they replicate with these companies did.

If you look at them, salesforce.com and vmware got to a billion from 200 million in sales in 3.5 years.

If they can do it, where they are trading right now is higher than either of those companies did at the time.

The new york times did a quick list of 25 companies that could be worth a billion dollars.

We have seen a lot of them and they.

We were talking about google buying nest -- that is $3 billion.

When facebook brought instagram, that was a billion dollars.

We thought it was crazy but they have integrated it and arguably made the product better.

If you look at these acquisitions, that's something that during the bubble got to be very excessive.

At this right, companies like google or facebook, they could make a billion dollars or $2 billion if you are google and it won't impact the model and could open up a new market.

Where it could become bubble like is when deals occur and the analysts only talk about look at the new total addressable market.

We are going to increase our price target on this company, but we are not changing numbers because it's gone up 50%. the stocks start reacting to that, then you have to say i need evidence that this is going to be there.

A fair point.

Hold that thought and we are going to come back and take a break in just a few minutes

This text has been automatically generated. It may not be 100% accurate.


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