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'Get Ready' for Tech Outperformance: Strong Buys & Trends - Pt. 1

Friday, 13 Aug 2010 | 4:21 PM ET

Tech stocks were among the worst performers this week. When will the sector see a turnaround—and should investors be buying on the dips? Scott Kessler, equity analyst at Standard & Poor’s, and John Aiken, director of equity research at Majestic Research, shared their sector outlooks.

Tech Turnaround on Horizon?
August has not been kind to tech stocks so far. Scott Kessler, of Standard & Poor's, and John Aiken, of Majestic Research, discuss whether there might be a turnaround for the sector on the horizon.

“We think it’s a good time to be involved in the technology sector,” Kessler told CNBC.

“The third quarter is seasonally weak for the sector and we think that this is being exacerbated by what’s going on in the economy, as well as inventory shortages that are turning into inventory gluts.”

However, Kessler said while techs tend to underperform in the third quarter, they are historically known to outperform in the fourth quarter.

“So we think it’s appropriate to get ready for that outperformance now,” he said.

See Part 2 for Aiken's views and strategies.

Kessler has “Strong Buys” on:

Apple

EBay

Google

IBM

Oracle

EMC

Nokia

LDK Solar —"[They are a] large China-based solar company," Kessler said of the firm. "The company reported results recently and we thought they were very good."

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Scorecard—What They Said:

  • Aiken's Previous Appearance on CNBC (Jul. 9. 2010)
  • Kessler's Previous Appearance on CNBC (Jul. 20, 2010)

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More Views on Tech:

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CNBC Data Pages:

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CNBC Slideshows:

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Disclosures:

Kessler does not own shares of AAPL, EBAY, EMC, GOOG, IBM, LDK, NOK, ORCL, ENER, ERIC, ERTS, SNIC or VRSN.

No immediate information was available for Aiken or his firm.

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Disclaimer

  Price   Change %Change
EBAY
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EMC
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IBM
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LDKSY
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NOK
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ORCL
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The Priceline Group
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BIDU
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MELI
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AMZN
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EXPE
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NILE
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AAPL
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GOOGL
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