Bezos' investor is launching a question bull run for technology stocks thanks to Gurley's investment

Bezos' investor is launching a question bull run for technology stocks thanks to Gurley's investment ...

Bill Gurley, a general partner at Benchmark, can be added to the list of those who believe technology companies are undervalued.

During the second half of a 13-year amazing bull run, a whole generation of entrepreneurs and technology investors grew their perspectives on valuations.

The process of learning might be painful, unexpected, and ennuisome to many. I anticipate denial.

Recent losses made by technology companies haven''t made them a bargain, according to Gurley. The Nasdaq Composite, a tech company, has slowed 22% so far this year, but has dropped 23% from its previous high in November.

Irrelevant Highs

Gurley said previous all-time highs are completely irrelevant. Its not cheap because it is down 70%. Forget about those costs.

He isn''t too impressed with valuations. Often, hack proxys are very powerful. It''s risky to use, according to Gurley.

If you insist, 10X should be considered to be phenomenal and an upper limit. Over that silly. Perhaps he means ten times sales.

According to Gurley, valuation metrics may be unfriendly towards tech companies. You may be tense to learn that people want to value your company on [free cash flow] and earnings, he said. Facebook is trading at 14X [earnings] and is up 23%. What earnings multiples are you assuming?

The Quantity of Revenue and Profit That Matter, according to Gurley

Bezos Agrees

Get, Inc. ReportFounder and Executive Chairman Jeff Bezos, has a receptive audience. Bill is without doubt one of the best people I know, and always worth listening to, according to Bezos.

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Most people underestimate the significance of this bull run. Such things are unstoppable until they aren''t implemented. Markets teach. The lessons can be painful.

Bezos should know. Amazon stock has dropped 17% since April 28 due to a poor earnings report. He lost $21 billion in 24 hours.

Concerns about rising interest rates have hit tech stocks hard. That''s because many tech businesses are unlikely to yield strong earnings until far in the future. Also increasing interest rates make the income from bonds, which are safer investments, more attractive for the present.

Bond rates have risen recently, with the 10-year Treasury increasing by 1.49 percent this year to 3%.

The Federal Reserve has begun raising interest rates in March, a 0.25 percentage point. Various experts predict the Fed will increase interest rates by at least half a point in May and June.

Not everyone has withdrawn from their company. Morningstar quotes four of them that it considers to be significantly undervalued and deserving of a wide moat rating:

Get Applied Materials, Inc. Report, a Semiconductor Equipment Manufacturer;

Get Autodesk, Inc. Report: Application Software company Autodesk (ADSK)

Get a KLA Corporation Report, which creates diagnostic equipment for semiconductor manufacturers, and ask for a KLA Corporation report.

Get a Microchip Technology Incorporated Report. Chipmaker Microchip Technology (MCHP)

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