Those shortfalls are, in large part, attributable to a rapidly evolving technology landscape, one that includes technologies like data centers, electric vehicles, and much more. That bodes well for SOXX’s long-term trajectory.
SOXX seeks to track the investment results of the PHLX Semiconductor Sector Index (SOX), which is composed of U.S. equities in the semiconductor sector. The fund generally invests at least 90% of its assets in securities of the underlying index and in depositary receipts representing securities of the underlying index. The underlying index measures the performance of U.S.-traded securities of companies engaged in the semiconductor business.
The tech-heavy
NASDAQ-100 Technology Sector Index s price-to-earnings (P/E) multiple stood at nearly 40 at the end of 2020, up significantly from 27.3 at the end of 2019 as investors bought tech stocks hand over fist amid the novel coronavirus pandemic. Micron, however, is relatively cheap, with a trailing P/E ratio of 33.5, while the forward earnings multiple stands at less than 20.
Micron s earnings are expected to grow at a terrific pace, as the lower forward P/E ratio indicates. According to consensus estimates, the memory specialist s earnings could jump to $4.18 per share in the current fiscal year from $2.83 in the previous year. Analysts also expect the company s earnings to zoom higher in the next fiscal year to $7.91 per share and the chipmaker could hit those forecasts on the back of higher revenue and fatter margins.
March 9, 2021
“This Time is Different” is an infamous phrase in finance that has historically led to some spectacular results, both positively and negatively. Over the past ten years in the United States, the information technology sector (“TECH”) of the equity market has outperformed all other equity market sectors by a significant margin
[1].
For some investors, the valuation of the TECH sector today is reminiscent of the TECH sector of the late 1990s and are worried about history repeating itself. In contrast, other investors highlight that the TECH sector is more mature, with higher margins and more stability. In our opinion, today’s situation has aspects similar to the early 2000s, but today’s situation is different.
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