Well while it is clear the P/E ratios today are on average much lower than during the dot-com bubble, they are still high enough in some cases to warrant taking a closer look at whether they are 'reasonable', I think.
For instance although King.com has a P/E ratio at launch of around 10 and many other top stocks like Google and Apple have P/Es below 30, Facebook currently has an estimated P/E ratio (ttm) of 101.7 [1]; Netflix, Amazon and LinkedIn clock in at 213, 612 and 941 as of last February; and Twitter has a negative P/E ratio of -10 or so, having lost $645 million in 2013 [2]. Not a clear picture by any means, but it is fair to ask if all these valuations are reasonable.
For instance although King.com has a P/E ratio at launch of around 10 and many other top stocks like Google and Apple have P/Es below 30, Facebook currently has an estimated P/E ratio (ttm) of 101.7 [1]; Netflix, Amazon and LinkedIn clock in at 213, 612 and 941 as of last February; and Twitter has a negative P/E ratio of -10 or so, having lost $645 million in 2013 [2]. Not a clear picture by any means, but it is fair to ask if all these valuations are reasonable.
[1] http://www.bloomberg.com/quote/FB:US
[2] http://www.newyorker.com/online/blogs/johncassidy/2014/02/wh...