Tech Stocks Witness Worst due to Russia Ukraine War: Plunging Over 75% from their Record Highs Past Year
- Published | 08 March 2022
Macro conditions had already started to tremble for tech companies. The inflation rate is at a 40-year high and the Federal Reserve is also concerned for consecutive interest rate hikes that are anticipated in the coming months. The investors started 2022 by fleeing off their growth stocks, which resulted in NASDAQ witnessing its worst month ever since the pandemic began. The past three-week report is indicating toward a bad to worse scenario. Russia’s invasion of Ukraine has made the market even more fragile. Oil prices witnessed the highest spike in more than 13 years, and the commodity prices have been on the rise owing to supply concerns as Russia happens to be a key producer of wheat, aluminum and palladium. While everything has received a hit, the high-growth tech stocks are taking a deep hit.
Snowflake has been trading at over 50% down from its 52-week high. Numerous stocks have been found to lose over three-quarters of their value ever since they peaked in late 2021, and there are others trading at below 90% or more.
Byron Deeter, who happens to be a partner at Bessemer Venture Partners, stated that the median members across his basket of stocks comprising subscription software are trading below 53%, and the price-to-sales multiples, on average, have compressed from 25 to less than 12. He stated that investors could continue the trade of extremely high-quality names, however, they’re on huge discounts right now across the board for long term investors.
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