![]() Of course, the stock eventually cracked, with shares falling over 90% from their record high as investors reconsidered whether the workout bike company was really worth nearly $50 billion (its peak market cap). The workout bike maker became a work-from-home darling during the pandemic, causing its stock to soar over 600% from March to December 2020, even as it posted consistent losses. Shares soared from the $96 IPO price (adjusted for a six-to-one reverse stock split) to nearly $1000 at one point, but when the market turned, the stock fell 99% to a low of just $6.60 by October 2002.įor a parallel today, consider Peloton. The company quickly racked up $142 million in losses in its first few quarters in business after spending millions on advertising using Star Trek star William Shatner, but that didn’t matter to investors.Īll they wanted was a piece of rapid growth from a company that was set to make travel agents a thing of the past. ![]() In 1999, the online travel agency became an overnight success, going public just over a year after its founding. And in both periods of economic expansion, the best-performing stocks belonged to growth-focused companies. Is that where markets are headed now? Another growth over profits eraįormer Fed Chair Alan Greenspan famously described dot-com-era investors and markets as “ irrationally exuberant,” and the 2010s clearly played host to a similar dynamic.īoth eras were marked by a growth-over-profits mentality on Wall Street and an aggressive proliferation of retail investing. And, of course, what followed the dot-com bubble bursting was a short but painful recession.
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