Technology stocks are under pressure as the headline FAANG stocks of Facebook, Amazon, Apple, Netflix, and Google (now Alphabet) drag on the markets again Monday morning as they did on Friday.
Apple has the lowest shares, which are down close to three per cent.
This follows Apple’s Worldwide Developers Conference last week where they unveiled their HomePod device to compete with Amazon’s Alexa.
As we witness the first real pullback of the year, the big question for tech investors in the sector is whether valuations might be a little stretched as tech, measured by the S&P500 IT Index is up 18.55% year-to-date.
One measure of valuation in the sector shows price to earnings, the ratio of what it costs to buy a company over what it’s expected to earn.
This has increased from 17 times to 19 times over the last year.