While many traders saw the mid-December market meltdown as a "catharsis" of sorts, a long overdue and much-needed "mean reversion" process, one which hit hard stocks that were the biggest winners of 2018 and slammed "momentum" names, those which had enjoyed the biggest pile up of "smart money", while names that had seen little institutional institutional interest (and were heavily shorted) outperformed, arguably bringing some semblance of normalcy to a gaping valuation dispersion, one month later something unexpected has emerged.

According to Sanford Bernstein, momentum stocks have not only regained their mojo in the past three weeks, but according to Bloomberg, now display a valuation gap relative to losers that widened to levels not seen since the dot-com era.

"This is worrying - the spreads are (much) higher than they were in February 2009 – a catastrophic career-costing period for momentum," Bernstein wrote in the note to clients. "This shocked us and caused us to double check our numbers."

The numbers were correct.

According to the report, and as observed in the latest batch of 13F filings, healthcare and utility stocks joined technology in the list of winners over the past 12 months. And while these newly minted "momentum" stocks got cheaper during the sell-off in late 2018, losers such as financial and commodity shares fared even worse.

As Bloomberg's Lu Wang notes, it's not just a sector phenomenon, as drilling down the differential within the same sector revealed a similar pattern: namely high-momentum stocks traded at double the price-to-earnings ratio of low-momentum shares. In fact, as the chart below shows, that was the highest premium since 2000.

According to this data, investors have once again not only not learned anything from the December shock, but are piling back into the very same names that were the main culprits for the sharp fourth quarter swoon. And, as one would expected, as money once again piles into the very same names, another reversal could "mean trouble", according to Bernstein strategists Sarah McCarthy and Inigo Fraser Jenkins. Why? Because the last time momentum-stock valuations approached the sort of extremes seen in 2000, the strategy tumbled 53 percent in the following six months.

Oh, and the market crashed.

"While the sector exposure is now more balanced, the valuation spread has become even more extreme,” the note warned, adding that "the re-rating of winners and the de-rating of losers has been very pervasive and extreme even within sectors."

As Bloomberg notes, Bernstein isn’t the only bank warning on the gaping momentum divergence: a few weeks ago, Bank of America cited momentum as the biggest risk for money managers this year as market volatility is poised to pick up.

For now, however, and as in recent years, momentum investing has once again proven to be a winning strategy, largely with the help of the Fed which has implicitly backstopped risk with Powell's dovish relent over the past two weeks. Meanwhile, until the next crash, the MTUM Momentum Factor ETF, has gained almost 15% every year since its inception in 2013...

... outperforming the broader market's 12% annual increase. And, perhaps most surprising, MTUM also beat the S&P500 by almost 2% points last month, when the index was on the brink of a bear market.

How much longer this divergence continues is anyone's guess, however just like in 2000, it is probably safe to say that the wider the spread gets, the more violent the ultimate repricing of momentum stocks will be... at some point in the not too distant future.