The veteran strategist known for navigating investors during the dot-com boom and bust isn't sounding the alarm this time around.
Ned Riley says skepticism over the latest record-breaking tech rally doesn't have much merit.
"Valuation isn't so ridiculous," said the Riley Asset Management CEO on Thursday's "Trading Nation."
Concerns about the health of the rally have been growing because the gains are basically concentrated in four stocks: Apple, Facebook, Amazon and Alphabet. But that's no reason to throw in the towel on tech stocks, according to Riley.
"There are fewer stocks obviously driving this market up than there were two or three years ago. But all I feel is that this is a recognition of investors seeing that these stocks clearly do have value," said Riley, who was State Street Global Advisors' chief investment strategist during the dot-com era.
"They have mispriced them in terms of earnings-price ratios relative to their growth rates. When you start to look back now on these companies, they have had a long-established growth record in terms of earnings per share. And it has not been recognized until now." "
Riley was considered a fixture on CNBC in the late 1990s and early 2000s, where he often discussed tech stocks. Since his last network appearance on Dec. 26, the Nasdaq has soared more than 14 percent.
So far this year, it's closed at record highs 34 times — with its latest one coming on Thursday. The index is now up more than 19 percent since the November presidential election.
Riley, who owns many of the major tech names in his portfolio, singles out Apple as a particularly bullish play right now.
"It's still the cheapest stock out there. It's selling at just about one times its growth rate. It should be selling at two or three times its growth rate," Riley said.