Technology firms continue to rip higher this year. The Nasdaq is already up over 18% so far this year. This is after a technology firms underperformed for quite some time even up through the first part of this year.
The tech story is a mirror image of the the Internet bubble of the late 90's. Today technology firms are growing rapidly, have superbly strong balance sheets, high free cash flow, high net income and they have nothing to do with mortgages or subprime.
But here is the best part. The large tech companies are huge beneficiaries of the global growth story. Google, Apple, Cisco, Hewlett Packard, Dell, Microsoft all have a very large percentage of their revenues come from international operations. The falling dollar is further enhancing these companies results.
We are experiencing an unprecedented global growth story around the world. All of these strong global economies need computers, software, telecommunications, search, etc. We are also in what is traditionally the strongest seasonal period for tech companies. I believe that tech will see a strong finish going into the end of the year.
Disclosure: at the time of this posting the author was long GOOG, AAPL, CSCO, HPQ, DELL, MSFT.
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1 comment:
The tech story is a mirror image of the the Internet bubble of the late 90's – this means that its basically opposite, right?
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