Author: Andreas FürstPublisher:
ISBN:
Category :
Languages : en
Pages :
Book Description
On 10 March 2000, stocks on the NASDAQ closed at all-time highs, before stock markets came to a crashing halt, when the so-called "dotcom-bubble" burst. Regarding today's market situation, on 31 December 2017, stock markets around the globe were closing at near all-time highs again. But this time around Asian technology stocks are playing a major role in this picture. In recent years, media has likened the idea of a potential new bubble developing in the US, comparing it to the events from the dotcom era. To the author's knowledge, the assessment of a potential technology stock bubble building in the Asian technology stock market has not been addressed yet by academic research. Therefore, this thesis aims to fill in this gap using an original research method. The cross-section of 153'681 firm-year observations of accounting and market prices data and 309 valuation reports were analyzed in an attempt to compare market prices and valuation methods of Asian technology companies today and during the dotcom-bubble. This thesis provided additional empirical evidence for the Ohlson (1995) model and the Xu & Cai (1996) model. Both models were able to explain less cross-sectional variation in Asia-Pacific technology stock market prices today compared to the historical period. Evidence from content analysis suggested that Asian technology stock valuation methods still share similarities to the valuation methods used for internet companies during the dotcom-bubble. In conclusion, the current situation in Asian technology stock markets cannot yet be seen as a bubble development.