A new four year high in SPX with the DIA and Tech making up for lost ground. Is this an epic up move that has several more % coming quickly or is this the boom before post options expiration bust?
I'm an IT geek by day, I wouldn't be shorting tech now. My company's 5 year MS licensing contract is up next year. We are buying new servers to replace old ones. We are ready to write a check for $100,000 - $350,000 to replace our 5 year old back up system. The VP is talking about buying new gigabit over copper blades into our backbone switch because new servers have Gig over copper. Soon our 4 year old EMC Symmetrix will be maxed out at 8 terrabytes of storage. In the next 1-2 years we will also start planning the replacement of our flagship SQL 2000 servers since we bought them in 2002. I've been at my company for 4 years. Back then we sent 10 tapes to off site storage. Now it's 60 every month. A lot of junk purchased 5 years ago is getting to the age where it needs to be replaced. I'm also getting calls from recruiters about consulting projects for different companies. Peter Lynch said invest in what you know. The last time this happened was around 2002 or 2003. Our VP asked one of his sales man friends how business was going. He said he saw a small pick up. Should have invested in tech then since 6 months later the stocks skyrocketed after this info got to wall street. Back then we started buying new equipement as well, took a break and now it's picking up again.
What kind of tech companies would benefit from company purchases to replace the kind of equipment you are referring to?
This poll is pretty useless because it doesn't specify the timeframe. How are you going to make sense of the results?
I just bought msft myself because of Windows 2003 adoption, but mostly because of the products they have coming out in 2006. X-Box 360 looks good. The biggie is business products. Over the last 5 years Microsoft has quietly invested a lot of money into business applications. They have already released several versions over the last few years, but 2006 looks like the start of another predatory cycle just like in 1995. The only difference is that Windows and Office aren't the weapons. It's MS SQL Server this time. You won't believe how much minor junk requires SQL. I think MS has a lot of good years ahead as it gets into various business applications from finance to IT management. If you look at their lifetime chart on Yahoo, you will see a flatline in the early 1990's and it shooting up starting in 1994. I think we will see a replay. Early 1990's MS spent a few years designing Windows 95 and Windows NT4 and it's still bringing in the cash from those investments. For backup we are either going to buy a new robot from ADIC with a new version of Veritas Netbackup or invest $350,000 into software from Avamar which also involves the purchase of 10 servers and Redhat licenses. We will probably go with the former. Avamar is still private, but it's resold by IBM. It's a content addressed storage solution. Every weekend we do full backups and incrementals on weekdays. We have hundreds of gigabytes of files and documents that are backed up and use up tape. With Avamar there is an initial full backup and then an algorith only backs up the changes. And if you have double of the same file across servers it's smart enough to detect it and only backup one version. For networking we got an Enterasys switch from a merger in 2002, but I own Cisco. We also buy HP servers. Thinking about buying HPQ, but I think Dell has better management. I own a Dell laptop and like Dell's website a lot better than HP's. I also own AMD. I've followed the company and lost money on them before, but the new CEO is doing some good things Jerry Sanders never did. More marketing and getting the name out for one. The lawsuit is timed perfectly too. Just as discovery gets underway next year they have a new Fab coming online in Dresden to produce their next generation designs. It think the lawsuit is just a scare tactic for them to win some design wins next year and don't really care who wins. I bought them at $14 based on what I read at Anandtech. They were releasing their new dual core CPU to servers first and not the desktop, much to the dismay of some people there. Better margins on servers. A lot of people at Anandtech are complaining these days that AMD CPU's are more expensive than they used to be. AMD actually raised prices in the last 6 months. Also own AAPL. The move to Intel is good for Apple as it will help them increase margins and improve time to market. I've read some blogs and look for a video Ipod next year. Archos has been selling a player like this for a few years, but with the success of Itunes I think Apple can convince the content producers to open up movies and TV shows. And Apple sells a bunch of video editing apps. A video Ipod will let people take their home movies to grandma's house. SYMC. Wall Street doesn't get it, but data integrity rules. In 2006 and 2007 look for AV, storage, back up and security products to be combined in the same package. I own a few other stocks just for diversification. Long term tech I'm looking at anything that deals with consumer electronics. I've read about rumors of ATI being bought out and it sounds interesting. I doubt it will be AMD. Probably Intel or Broadcom. They make some HDTV products and I think that is the target. In the next few years look for Microsoft, Intel, Apple and other US companies to rule the consumer electronics market. The box may be made in the third world, but the guts are owned by US companies. PC's are over. Laptops are growing, but yesterday's news. The next frontier is the living room.
Tech will never die, it has become a basic necessity. Higher end stuff will probably retain its high prices but the average consumer items like pc's will be pressured. Look at pc memory, it sells for about 60% less that a year ago. So what are some of those high end tech companies?