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'Get Ready' for Tech Outperformance: Strong Buys & Trends - Pt. 2

Friday, 13 Aug 2010 | 4:23 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.

Aiken said the tech sector will become “bifurcated”—companies levered to business spending will see slowness while companies with innovative business models around consumers will do well.

"Those fall into three categories," he said of the latter.

"Companies with international exposure like Baidu and MercadoLibre, those that are levered to mobile and mobile Internet like Apple on the device side and Google or Facebook on the software side, and those that have a truly niche innovation such as Amazon or Priceline.”
(See stock quotes for these companies, below.)

Aiken’s Tech Trends:

Trending Below Consensus: Blue Nile, Expedia, Google

Trending Above Consensus: Amazon

For Kessler's views and strategy, see Part 1.

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Stocks Mentioned in this Article:

Baidu

MercadoLibre

Apple

Google

Amazon.com

Priceline

Blue Nile

Expedia

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