Internet software and services: past and future

Abstract

The Internet has been extremely popular because of its many unique and powerful characteristics, such as ubiquity and global reach. Hence, it is interesting to study whether Internet companies can be sustained through a bubble and even after a bubble. This study therefore compares the Internet companies in the USA with other high-tech companies listed on the National Association of Securities Dealers Automated Quotations (NASDAQ) over a period covering the years from 1995 to 2006. First, we check whether there has been a bubble for these Internet companies, and we then try to compare the pre- and post-bubble periods to ascertain whether any of their stocks have been ‘overvalued’. Conclusions are drawn regarding the respective futures of these Internet companies.

Keywords:

• high technology
• return on investment
• stock return