Powered by MOMENTUM MEDIA
moneymanagement logo
 
 

Tech firms have had it ‘too good for too long’: Forager

twitter/technology/tech-stocks/Forager/

31 May 2022
| By Laura Dew |
image
image image
expand image

There is a “huge adjustment” coming for Silicon Valley as share price falls mean staff are unlikely to receive the same volume of remuneration and companies will attract new investors with a takeover agenda.

Technology stocks have fallen in the past few months with Apple down 17%, Amazon down 32%, Meta down 42% and Netflix down 67%.

In a webinar, Gareth Brown, senior analyst at Forager, said it was likely there would be a re-appraisal of Silicon Valley technology firms coming up which would be driven by the shareholders.

“There’s a lot of talk about whether the market in Silicon Valley is similar to 2000. Obviously there’s some parallels, [but] I’m quite sympathetic to the idea that this is different. These are real businesses now that generate a lot of money, not like back in the early days of the dotcom boom. I think there’s a huge adjustment coming for the staff in Silicon Valley. They’ve had it too good for too long.

“I think there will ultimately be a reappraisal here, it needs to come from the shareholders. The shareholders need to sit up and say, this is no longer acceptable.”

Steve Johnson, Forager chief investment officer, added there was a particular drive by different types of investor who were driving a takeover agenda such as Elon Musk’s bid for Twitter earlier this month which was changing how the firm was run.

He said: “The share prices get low enough and you start attracting a different type of investor that is coming in with a specific agenda here to change the way it’s going on.”

However, Brown countered that were still technology firms where the share price had fallen but no different type of takeover investor had appeared because they couldn’t work out the firm’s intrinsic value.

Forager held a stake in Twitter and previously said it was disappointed by the move by Musk to purchase the firm.

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

Significant ethical issues there. If a relationship is in the process of breaking down then both parties are likely to b...

6 days 13 hours ago

It's not licensees not putting them on, it's small businesses (that are licensed) that cannot afford to put them on. The...

1 week 6 days ago

So we are now underwriting criminal scams?...

6 months 2 weeks ago

After last month’s surprise hold, the Reserve Bank of Australia has announced its latest interest rate decision....

1 week 1 day ago

Libby Roy has been appointed as an independent non-executive director on the board of AZ NGA....

4 weeks 1 day ago

A professional year supervisor has been banned for five years after advice provided by his provisional relevant provider was deemed to be inappropriate, the first time th...

3 weeks ago

TOP PERFORMING FUNDS

ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
DomaCom DFS Mortgage
74.26 3 y p.a(%)
3