Wednesday, May 19, 2010

Tech Is Much Too Cheap Here

At today's prices, leading tech is as cheap as it was during this whole up move, save the landmark lows of 2008 and 2009. This massive valuation disparity will close once again, and I think it could happen violently.

Moreover, the last two to three quarters have produced copious amounts of cash flow, as well as large net cash increases on tech balance sheets. Prices to net cash and cash flow have come in as dramatically as P/E's have of late. This might help explain the recent surge in M&A.....Especially cheap, not surprisingly, is AAPL.

long AAPL

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