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Conservative spending and high productivity have helped tech stocks thrive in a weak economy, said Scott Kessler, director of the Information Technology Research Group at Standard & Poor's.
Here are a few stocks he recommended as potentially recession-proof.
Recommendations:
EMC [EMC
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]: The computer hardware company's first-quarter results were better than expected, and it plans to further invest in sales and marketing, Kessler said.
"A lot of people know them for being the largest provider of storage hardware," he said. "A lot of people don't know, however, that they're really big when it comes to software and services."
Although the stock is down 16 percent on the last six months, forward earnings are expected to rise 20 percent, he said.
Hewlett-Packard [HPCS
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]: S&P just upgraded the company to a "strong buy," Kessler said, adding that its stock trades cheap at a 12 or 13 multiple on the year.
"A lot of people, I think, were spooked by the EDS deal," he said. "We see a lot of potential there."
IBM [IBM
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]: IBM is a good investment because it's not just about the financials, Kessler said. Energy companies and stocks are doing well and are therefore spending more when it comes to outsourcing and consulting. This will help companies like IBM and business support services firm Accenture [ACN
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].
Oracle [ORCL
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]: The software company is a cheap stock that is sticking by 20 percent earnings growth each year, Kessler said. He predicts this growth will continue.
Disclosures:
Neither Scott Kessler nor his company own shares in the above-mentioned firms or furnish them with investment advice.
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