Stock Smarts: Tech Battles Back
Tech stocks were already slumping well before the attacks on September 11, 2001. And shortly after the terrorists hit the World Trade Center and the Pentagon, many big tech stocks hit new lows.
But take a look at the recent stock performances from three of the biggest in the business, after falling to new lows after September 11:
Is this tech rally digging in for the long haul, or are the moves fleeting?
Brain Finnerty from C.E. Unterberg Towbin says that for investors, this move is good, and you should hold on for more positive gains. If you are a trader, however, you should think about taking some money off the table and selling shares for profits.
Jonathan Hoenig from Capitalist Pig Asset Management compares the big cap tech stocks to you old Aunt who recently had a hip-replacement surgery. She’ll get up and walk again, but she’ll never be the same. These tech stocks are coming off the lows, and are better than they once were, but in no way will the ever be the same. He sees those big three in a trading range for quite some time.
Hilary Kramer of the Cisneros Group agrees that the tech stocks will never return to their highest levels, saying that investors must closely at the specific companies in the sector moving ahead.
Dagen McDowell from SmartMoney magazine says that now the market is looking for real, sustained earnings in order for this rally to move forward. But she also cautioned that all advice is totally susceptible to any new form of terrorist attacks.
Three from our panel then offered up some tech stocks they are bullish on:
Hilary: Microsoft (MSFT)
Jonathan: Tech Data (TECD)
Brian: JDS Uniphase (JDSU)
Mutual Fund Face-Off
Topic: The best aggressive growth fund
Panel: Dagen McDowell and Jonas Max Ferris from Maxfunds.com
Dagen - Wasatch Small Cap Growth Fund (WAAEX)
Jonas - Bridgeway Aggressive Growth Funs (BRAGX)
Dagen and Jonathan wrapped up the show by answering some email question from viewers:
Question #1: Terayon (TERN) is up 70% since September 11, 2001. Any word on this one?
Jonathan: If you’ve never owned an Internet stock (Terayon makes cable-modem systems), then this is a good place to roll the dice. But be prepared for a bumpy ride - it is a $10 stock that could continue to go up, but also could come back down.
Dagen: It’s too pricey.
Question #2: Where do you think that Pixar (PIXR) will be going with their new movie “Monsters, Inc.” coming out soon?
Dagen: The movie could be a huge hit, but that doesn’t mean the stock will move according to the box office returns. In fact, the stock fell immediately after the release of the first “Toy Story” movie, which was a huge success.
Question #3: Do you know how to find out which days are most favorable for investing in the market?
Jonathan: No one knows for sure exactly what the market will do. If they did they wouldn't sell that information to you for $10 a month.
Dagen: There are definite patterns to the market, but any sudden event (re: September 11 attacks) can make those patterns go away.
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